National Human Development Report Albania 2000

Home , Besnik Mustafaj, Brez (clothing), Health in Albania, Ismail Kadare, Kastriot Islami, Pandeli Majko

ALBANIAN HUMAN DEVELOPMENT REPORT 2000

Group of Experts Dr Ylli Çabiri, Chairperson Dr Arjan Starova, Milva Ekonomi, Piro Misha, Remzi Lani, Dr Vasillaq Leno, Prof Dr Ylli Vejsiu

in collaboration with the following institutions from civil society: Human Development Promotion Center (HDPC) Institute of Contemporary Studies (ICS) Center for Sociological, Political and Communication Studies (CSPCS) Center for Economic and Social Studies (CESS) Albanian Institute for International Studies (AIIS) Urban Research Institute (URI) Albanian Demography Association (ADA) and Alfred Peza, Andi Gjonej, Andrea Stefani, Arjana Misha, Prof Dr Arqile Bërxholi, Prof Dr Artan Fuga, Artan Hoxha, Besnik Mustafaj, Blendi Fevziu, As Prof Dr Bukurie Dumani, Eduart Prodani, Ela Banaj, Prof Dr Ermelinda Meksi, Fatos Lubonja, Prof Dr Genc Ruli, Godiva Rëmbeci, Ilda Bozdo, Jeffrey A Brez, Dr Lekë Sokoli, Dr Lindita Xhillari, Prof Dr Kastriot Islami, Dr Makbule Çeço, Prof Dr Maksim Cikuli, Margarita Caci, Prof Dr Marta Muço, Dr Milika Dhamo, As Prof Dr Pëllumb Xhufi, Remzi Qerimi, Skënder Shkupi, Shkëlzen Maliqi, As Prof Dr Telemak Xhaxho, Prof Dr Vladimir Misja, Prof Dr Ylli Pango, Dr Zyhdi Dervishi,

statistical tables and figures prepared by: Vojsava Progri, Institute of Statistics

an enormous support to the preparation of this report was provided by UNDP country representatives: Jan Wahlberg, Dr Parviz Fartash

project coordination and management by Vladimir Malkaj, David Garrigos, Albi Greva UNDP Tirana

in collaboration with the Institute of Statistics cover art: Ali Oseku, Albania 99 (250 x 180 cm, 1999) poetry on the back cover by Besa Myftiu, writer, emigrated to Switzerland translation of the poetry by Dr6 Uk Buçpapaj

Evis CergaCerga, translator Prof6 Dr6 Xhevat Lloshi, editor of the Albanian version

design and print by LILO sh6p6k6 - Tirana

Information contained in this report is not subject to copyright6 However, clear acknowledgement of the Albanian Human Development Report 2000 authorship is required, when using this information6

The views expressed herein are those of the authors of the report and do not necessarily reflect the views of the United Nations or the United Nations Development Programme6

The Albanian Human Development Report 2000 is available electronically through the Internet World Wide Web, at: http://wwwalundporg

Note:

- The report refers to the developments in the country until the end of March 2000

- This report is based mainly on official statistics, as well as data and figures provided by NGO-s and other collaborators6

Rruga Dëshmorët e 4 Shkurtit, Nr 35, Tiranë Tel +355 4 233148 - 9; Fax +355 4 232075 E-mail: registryal@undporg Internet: wwwalundporg

2 HUMAN DEVELOPMENT REPORT TABLE OF CONTENTS

EXECUTIVE SUMMARY 5 CHAPTER I - ECONOMIC INSECURITY 9 1 1 POST-CRISIS RECOVERY? 9 UNSTABLE PRODUCTION GROWTH 9 LOW INFLATION 9 LACK OF CREDIT 10 A STABLE CURRENCY? 11 THE EUPHORIA OF FIGURES 11 SLOW PACE OF BUSINESS DEVELOPMENT 11 FOREIGN AID AND PUBLIC INVESTMENTS 13 1 2 FAMILY LIVING STANDARDS 14 HOUSEHOLD INCOME 15 HOUSING 16 MATERIAL CONDITIONS 17 1 3 EMPLOYMENT INSECURITY 18 THE LABOUR MARKET 18 SOCIAL PROTECTION 19 SOCIAL POLICIES 19 WAGES 20

CHAPTER II - SOCIAL INSECURITY 22 21 THE CITIZEN AND THE STATE 22 STATE AND POLITICS 22 STATE AND GOVERNANCE 23 ISOLATED CORRUPTION IN EUROPE OR PART OF EUROPEAN CORRUPTION? 24 STABILITY PACT AND ANTI-CORRUPTION INITIATIVE 24 2 2 HEALTH PROTECTION 25 2 3 EDUCATION 26 FUNDAMENTAL CHANGES 26 THE CHALLENGES 26 2 4 YOUTH IN SEARCH OF MORE SPACE 28 2 5 CRIMINALITY A DIFFICULT CHALLENGE 29 ORGANISED CRIME INCREASINGLY SOPHISTICATED 30 HUMAN TRAFFICKING 31 WOMEN AND CHILDREN VICTIMS OF ORGANISED CRIME 31 2 6 DRUGS 32 DRUG USERS 32 DRUG PRODUCTION AND TRAFFICKING 33

CHAPTER III - EMIGRATION 35 31 MASSIVE EMIGRATION 35 HISTORICAL OVERVIEW 35 EMIGRATION AFTER THE COLLAPSE OF COMMUNISM 35 MASSIVE EMIGRATION AN ESCAPE FROM ISOLATION 36 WHERE TO EMIGRATE? 36 CHANNEL OF TEARS 37 A BACKWARD ECONOMY THE MAIN FACTOR BEHIND EMIGRATION 38 WHY DO ALBANIANS EMIGRATE? 38 CHOICE OF THE COUNTRY FOR EMIGRATION 38 THE SITUATION OF EMIGRANTS 39 THE BALANCE OF LEGAL/ ILLEGAL EMIGRANTS 40 32 BRAIN DRAIN 41 CANADA PHENOMENON 42 33 THE IMPACT OF EMIGRATION 42 DOMESTIC LABOUR MARKET 42 EMIGRANTS REMITTANCES 43

ALBANIA: 2000 3 EMIGRATION AND INVESTMENTS 43 EMIGRATION AND EDUCATION 43 MULTICULTURAL INTEGRATION OR ASSIMILATION? 44 THE FAMILY AND EMIGRATION 44

CHAPTER IV - MIGRATION 46 41 HISTORICAL OVERVIEW 46 THE STAGES 46 THE DIRECTION OF MIGRATION 47 42 SOCIOLOGICAL ASPECTS 48 FAVOURED RURAL SETTLEMENTS 48 RURAL OR URBAN UNEMPLOYMENT? 49 43 MAIN CAUSES OF MIGRATION 50 TRANSITION IN A LIBERAL SOCIETY 50 WEAKENING OF ECONOMIC TIES IN THE VILLAGES 50 THE COLLAPSE OF THE FAMILY CLAN STRUCTURE 50 THE CITY AS AN IDEAL 50 NO NEED FOR SELF DEFENCE 51 44 MIGRATION IMPACTS 51 THE SOCIAL AND ECONOMIC CONSEQUENCES OF MIGRATION 51 THE TENSION CREATED BY URBANISATION 52 OLD AND NEW YARDSTICK 53 THE PSYCHOLOGICAL AND CULTURAL IMPACT OF URBANISATION 53 THE METROPOLIS 54 SATISFIED OR DISAPPOINTED? 55

CHAPTER V - ALBANIA WITH REFUGEES AND EMIGRANTS 57 51 THE KOSOVO CRISIS AND ALBANIA 57 52 DEATH BROUGHT US TOGETHER 59 53 THE IMPACT ON THE ECONOMY 61 54 HANDLING THE EMERGENCY 63 MANAGEMENT OF EMERGENCY 63 CIVIL SOCIETY AND THE KOSOVO CRISIS 64 ALBANIAN MEDIA IN 1999 A FLEETING CONSENSUS 64 55 NEW RELATIONS WITH THE INTERNATIONAL COMMUNITY 65 CO-OPERATION WITH NATO 65 CO-OPERATION WITH OSCE 66 ALBANIA AND THE COUNCIL OF EUROPE 66 UNITED NATIONS AGENCIES 67 ALBANIA AND ITS NEIGHBOURS DURING THE KOSOVO CRISIS 67 56 ALBANIA AND THE STABILITY PACT 67

ANNEXES - STATISTICAL DATA70

4 HUMAN DEVELOPMENT REPORT E XECUTIVE SUMMARY

CHAPTER I: areas, or going abroad ECONOMIC INSECURITY CHAPTER II: Continuous and successful efforts have been SOCIAL INSECURITY made in Albania to stabilize the macroeconomic indicators After Gross Domestic Product fell Albania is still regarded as a country with poor abruptly in 1997 to the level of 1992, it has since levels of social, political and economic security increased by 8% every year In 1999, inflation and high levels of crime According to widely was almost nil and for the first time, there was accepted opinion, the inability of the state to no increase in the budgetary deficit After a sharp perform some of its vital functions is one of depreciation in 1997, the currency has shown a the most serious impediments to Albanias de- tendency to appreciate and then stabilize For- velopment and social stability during the post eign aid still provides the lions share of finance communist transition for public investment and by the end of 1999 it totalled approximately USD 27 billion In the There seems to be no social contract between last two years, foreign aid alone totalled USD the government and the citizens This is linked 680 million But the disbursement rate of funds to the manner in which the country has been is low and only 50% of the funds have been governed in the last ten years, as well as the way spent The country continues to have a prob- in which the political and economic model for lem absorbing aid Albania was conceived Capitalism has often been perceived as a game with no rules, where Despite the fact that economic growth has been getting rich justified breaking the law and where real and visible it has not had a substantial im- participation in politics was sometimes seen as pact on the life of Albanians The Albanian fam- a fast way to prosper While this kind of capi- ily remains poor and has little income and inad- talism has created dynamism it has also encour- equate living space Only one in five families aged mass idleness by promoting the mentality thinks that it has enough resources for a decent that one can get rich without really having to life and 20% of households receive just 5% of work, or by being corrupt the countrys total wages Households estimate that they need a minimum income of Lek Public health in Albania faces both inherited and 31,000/month to lead a decent life, while the new problems The most serious have to do declared average income is Lek 17,000/month with the dilapidated health infrastructure, the lack The average living space is approximately 62 of pharmaceuticals and medical supplies and m2 or 146m2 per person Opportunities to buy the poor financial incentives for health profes- a house are limited sionals There is a strong tendency for people to travel abroad for treatment Unemployment remains high This is due to a lack of large scale investments, shortage of The education system of the last ten years faces skilled labour, a large informal market, a lack problems with curriculum and teaching meth- of coordinated state policies on employment, ods as well as the management of human re- inefficient labour market institutions and a low sources Insufficient financial resources are also level of credit During 1999, approximately 17% a serious problem The education budget has of families in Albania received assistance from been a constant of 9-10% of public expendi- the social protection programme During the ture annually or approximately 3-4% of the same year, 260,000 people received an old age GDP, but while 75% of this money goes to pension with an average pension of Lek 4,000 salaries only 9% goes towards investment Con- - 5,000 per month tributions from parents are small and are not included in the official statistics Big difficulties Faced with this economic insecurity, many have arisen from the mass movement of people Albanians are migrating to more developed towards cities and coastal areas

ALBANIA: 2000 5 Albanias geographical position, the war in ligious intolerance, negative stereotyping by the Kosovo, lawlessness and the lack of means to press and mass media which influences the atti- combat crime have turned the country into a tudes of the local population towards Alba- highway for trafficking from the East to West- nian emigrants, and the poor social and com- ern Europe Organized crime keeps growing, munity life of the Albanian emigrants in these illicit human trafficking in complicity with crimi- countries nal groups from neighbouring countries is on the rise along with drug trafficking and an in- During 1990-1999, approximately 40% of the creasing number of drug users overall number of professors and research scientists of the universities and science institutions CHAPTER III: in the country have emigrated Many highly edu- EMIGRATION cated people who have gone abroad do not work in their area of specialisation They will Emigration is a phenomenon that has occurred eventually forget their previous knowledge and throughout Albanias history Early emigration training In Albania, there is a growing debate came as a result of economic backwardness, but on the Canada phenomenon, which is based also as a result of political insecurity and clashes on the selective nature of this emigration During 1923-1944, the number of emigrants reached approximately 150 thousand people, Emigration has had an important impact on the representing about 13% of the overall popula- reduction of unemployment in the country, in tion Many of the emigrants who emigrated particular, in southern Albania, where the pro- after the end of World War II were political portion of emigrants is higher Emigrants re- opponents of the communist regime mittances represent approximately one fifth of the GDP, almost twice as much as foreign ex- After the collapse of communism massive emi- change revenues from exports and almost four gration resumed by legal and illegal means: by times more than the value of direct investments obtaining visas, illegal crossing of the state bor- Emigration has had a negative impact on ders, illegal passage on fast boats, and more re- childrens education because many children do cently by claiming Kosovar identity Illegal means not go to school in host countries often lead to tragedy, such as the case of the Otranto channel, which has turned into the CHAPTER IV: Channel of Tears, and where the number of MIGRATION people drowned or lost during 1999 totalled more than 340 Internal migration has been one of the most dramatic features of the Albanian transition The main factor behind emigration is the back- Most migration occurs between the village and ward economy Preferences related to the choice the city of the country for emigration are governed by geographical proximity, culture and other fa- The main goal is to escape the misery of life in cilitating factors The USA and Canada are now the villages Many of the newcomers are young the preferred countries for emigration, while dur- or middle aged For rural youth the lure of the ing 1992 this status applied to Italy and Ger- cities is obvious - they have a clear choice be- many where most emigrants have now settled tween unemployment in the village and unem- The ratio of clandestine emigrants to legal emi- ployment in the cities Middle aged parents come grants is beginning to even out to the cities so that their children can get better schooling Male Albanian emigrants in Greece and Italy are mainly engaged in construction or agricul- The massive migration of recent years has been ture, whereas women are employed in domes- spontaneous, uncontrolled and unplanned and tic services Employment in these sectors is re- has caused many serious economic and social garded as a way of survival rather than a means problems The huge rural population that ar- for integration and emancipation Integration rived in the cities in a short space of time, becomes more difficult for the following rea- brought with it customs, traditions, mentalities sons: a difficult labour market, political and re- and lifestyles from many different areas of Al-

6 HUMAN DEVELOPMENT REPORT bania The social diversity which resulted from of Kosovar refugees took place very quickly this movement has caused conflict and tension Within a few days approximately 320,000 dis- in city areas which were hitherto relatively ho- placed had taken shelter in the houses of Alba- mogenous communities nian families, 75,000 in the camps and about 85,000 in public buildings which were turned Indigenous citizens are often scornful and dis- into large scale collective shelters After the end missive of the new arrivals while some even of conflict, 95% of the Kosovar refugees re- fear the villagers who have moved into their turned home within less than four weeks The neighbourhoods Rural depopulation is also a humanitarian emergency was managed by the serious problem There is an obvious need for Government of Albania and UNHCR, along strategies to control and guide this urbanization with other UN organisations, NATO/AFOR process and OSCE The Emergency Management Group was set up to co-ordinate the humani- Tirana has experienced a spectacular influx of tarian aid process people In 1999, 618,000 inhabitants lived in Tirana district compared to approximately 374, Local NGOs alongside foreign ones made a 000 in 1990 Half of the citys population lives very important contribution to the management in four of the most peripheral administrative of the crisis Paradoxically, Albanian civil soci- units Among these units, Lapraka has experi- ety seems more dynamic in times of crisis than enced the most rapid growth It has 50, 000 in peacetime inhabitants and its problems are typical of uncontrolled urbanization For the first time in Albanias post-communist history, the Albanian media sent a unified mes- While many say their lifestyles have improved, sage to the Albanian public, conveying support they admit that they would never have left their for NATO and for the refugees Notwithstand- villages if economic conditions there had been ing its financial constraints, the media reported better Many have been disappointed by city life truthfully and professionally the events in and are nostalgic for the old ways Kosovo and Albania

CHAPTER V: The Kosovo crisis marks an important moment ALBANIA WITH REFUGEES in Albanias partnership with other countries and AND EMIGRANTS its integration into international institutions Never in its modern history has Albania been The Kosovo crisis was accompanied by a huge so close to the West Its international relations influx of Kosovars across the northern border have become more significant of Albania Within a few weeks, the number of refugees reached 450,000, which represented Albanias economy during the Kosovo conflict 15% of Albanias population The solidarity of was not a war economy But it suffered and still the local population was instrumental in avoid- continues to suffer in the wake of the conflicts ing a human catastrophe The international com- and insecurity that have prevailed in the region munity for the first time had the opportunity to over the last decade This insecurity has exacer- view Albania as a partner rather than a prob- bated the problems of economic reform lem Albania, of all the Balkan countries, was per- The Kosovo conflict created the historical mo- haps the most enthusiastic about the Stability ment when the Albanians of Albania encoun- Pact There has been full Albanian political con- tered the Albanians of Kosovo As Ismail sensus on the Pact from the first day of its Kadare puts it: Death brought us together launch The Stability Pact was perceived as the While the Kosovar refugees were well impressed regions big opportunity to rid itself of con- by the generosity and hospitality of their blood flicts and get closer to the rest of Europe brothers, they were shocked by the state of infrastructure in the country For Albania to get the best results from the Sta- bility Pact, it is necessary to create some kind The arrival and departure of massive numbers of Albanian Stability Pact, ie an internal agree-

ALBANIA: 2000 7 ment that would channel energies towards con- be perceived as an opportunity for the political sensus and reconstruction rather than political class to shape the countrys future, not as an in- conflict In addition, the Stability Pact needs to ternational patronage that will solve everything

8 HUMAN DEVELOPMENT REPORT Chapter I ECONOMIC INSECURITY

11 Post-crisis recovery? Despite continuous and ongoing efforts to implement a tight and successful Unstable production growth macroeconomic policy, the country remains Gross Domestic Product (GDP) growth has very crisis prone High unemployment and been unstable during the last ten years of tran- poverty imply that a cautious macroeconomic sition, as in the case of the majority of coun- policy combined with social policies and tries in the region During the political and economic upheaval of 1997 there was an abrupt regional development is imperative fall in GDP, reducing it to the level of 1992 Concentrating on improving macroeconomic But GDP has improved considerably in 1998 indicators at the expense of poverty reduction and 1999 growing by an annual 8 %, the same programmes could leave the country exposed rate of growth as in 1994 This can be attributed to the rapid recovery of the construction to more instability in the future and transport sectors, which suffered badly during the troubles of 1997 Low Inflation

Fig1 Annual growth of GDP (in %) Despite the fluctuations of 1996-1997, anti-in- flationary efforts have yielded visible positive results The period 1992-1995 was especially successful Inflation was 20 reduced from approximately 15 10 237% to 6% In 1999, as a result 5 of a stable currency and a policy 0 of cautious control over money -5 1991 1992 1993 1994 1995 1996 1997 1998 1999 supply and the budgetary deficit, -10 inflation fell to 07%, the lowest it -15 has been since 1990 -20 -25 Monetary and fiscal policy has -30 been tight during the transition -35 period in order to create the right economic environment for sus-

Tab 1 Annual growth in other countries of the region in %

1995 1996 1997 1998 1999 Albania 133 91 - 7 80 80 Bosnia Herzegovina 208 692 295 151 100 Bulgaria 29 - 101 - 70 35 15 Croatia 68 59 68 25 - 15 Federal Republic of Yugoslavia 61 35 74 26 -35 FYROM - 11 12 14 29 25 Romania 71 39 - 66 - 75 - 45

Source: World Bank, March 2000

ALBANIA: 2000 9 tainable growth, for the restructuring of the Lack of credit economy, for the privatisation of big enterprises and strategic sectors and to promote the devel- The number of commercial banks has increased opment of the financial system each year, from one licensed bank in 1992, to 11 in 1999 But there are still few banks com- Fig 2 Annual inflation (in %) pared to other countries in the region and the level of investments is very low In the last three 250 years, private investments totalled approximately 236.6 USD 47 million per year, compared to USD 200 90 million in 1995 and USD 97 million in 1996

150 Although the business community is in great

100 104.1 need of credit, very little has been extended It is estimated that in the last three years the over- 50 42.07 all credit given to the private sector is just 3% 30.9 17.4 15.8 6 8.69 of GDP, compared to 13-40% of GDP for 2.5 0.7 0 other countries of the region Banks operating 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 in Albania, including foreign private and joint- stock banks, have a very conservative lending Source: INSTAT, December 1999 policy, due to the following problems: A high risk of credit non-repayment, The government's fiscal policy is one of exer- A lack of business stability cising strict control over budgetary expenditure, A lack of appropriate and transparent ac- while trying to raise average income levels But counting despite these efforts, especially during 1998- Businesses do not meet the bank's criteria 1999, the budget deficit remains high for collateral On their part, businesses accuse the banks of Fig 3 Budget revenues and expenditures complicated and lengthy bureaucracy, high credit cost and high requirements for collateral 200000 As a result, there is a growing tendency to imple- 150000 ment microcredit programmes, where the risk is minimised since the amounts are smaller and 100000 the responsibility for credit repayment is not lim- Total revenue ited to the borrower only Total expenditure 50000 Budget deficit The positive steps taken by the Bank of Alba- 0 nia to facilitate business credit have not been 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 followed by a real increase of credits to the pri- -50000 vate sector Lack of banks in the majority of Source: Ministry of Finance, February 2000 cities, as well as the failure by banks and business to agree on mutual lending/borrowing re- Tab 2 Comparison of various financial indicators

Albania Bosnia Bulgaria Croatia FYR of Romania Herzegovina Macedonia Number of banks 11 70 28 60 24 35 Banks total assets (in % of GDP) 45 132 35 74 46 35 Credits for the private sector (in % of GDP) 3 - 16 40 21 13 Number of Insurance companies 3 - 30 23 - 47

Source: World Bank, 1999

10 HUMAN DEVELOPMENT REPORT quirements has led to low rates of domestic expectations, it has not had a substantial im- investment and unbalanced regional develop- pact on the lives of the majority of Albanians6 ment As a result the financial possibilities of The low starting point and the rapid restruc- starting a new business or expanding an existing turing of the economy inevitably made growth one are few and employment opportunities re- seem significant and impressive - but there main limited should have been no place for euphoria - because these changes created economic im- A stable currency? balances and social tension6

During the last ten years of transition, the value Albania is a small, geographically well placed of the Lek has depreciated continuously In 1999 country with considerable natural resources and 1 USD exchanged for approximately 1353 Lek, a relatively well educated youthful population with compared to about 25 Lek in 1991 While the a natural feel for business6 Yet there are en- Lek was relatively stable during 1993-1996 when trenched social, political and economic problems inflation dropped and GDP rose, the currency which make the Albanian transition difficult, and depreciated sharply in 1997 and has never re- the macroeconomic results unsustainable6 covered its former value However, during the last few years the public has shown more confi- Economic restructuring, a chaotic labour mar- dence in the Lek and in 1999 the exchange rate ket, a closed economy based on imports and strengthened considerably remittances, a lack of market institutions and finance centres, a widespread informal economy, corruption, delayed privatisation, weak management and administration of assets, ab- Fig 4 Exchange rate US$/Lek in years sence of an active civil society, poor law and

148.9 150.60 1.5

102.6 135.3 92.8 1 104.5

Leks per 1 USD 94.7 75.3 0.5

0 1991 1992 1993 1994 1995 1996 1997 1998 1999

Source: Bank of Albania, March 2000 order and public security, political instability and conflict in the Balkans have all contrib- The euphoria of figures uted to a lack of sustainability6

Until early 1996, the Albanian transition was hailed as a success by international institutions - Slow pace of business development at least in terms of macroeconomic indicators6 But the economic and political collapse of 1997 Small and medium size businesses account for and the analysis of the factors that brought about more than 99 % of private enterprises and 79% the crisis made analysts more cautious in their of these businesses have on average one em- interpretation of reported figures on economic ployee Fifty two per cent of these enterprises performance6 Although since 1993, economic belong to the trade sector due to the low entry growth has been visible and has met realistic barriers Only 10% of the companies operate

ALBANIA: 2000 11 in industry and half of these are based in cen- The government is finalising a medium term tral Albania, along the Tirana-Durres-Elbasan private sector development strategy to create a corridor more favourable market oriented climate for small and medium enterprise development The Prior to 1997, the size of new businesses had strategy is based on an assessment of the cur- grown rapidly In 1991, there were less than rent situation and aims to address the main con- 2,000 small and medium registered enterprises straints hampering the growth of business Numbers grew to 9,000 in 1993, and 16,400 in 1994 But the crisis of 1997 had a profound effect on the business community and only Results conducted from a national survey of about 3,000 managed to survive Since then, private enterprises, in 1999, by GTZ6 4,800 new businesses have registered, reflecting the improvement in the economy The ups and Because of the lack of credit, investments de- downs in the development of the private sec- pend mainly on an individual's personal finances tor coincide with the change in the GDP dur- and resources6 Eighty two per cent of private ing the same period enterprises surveyed, stated that they required credit6 Of these, 35% needed a maximum of In 1999, 70% of employed persons worked in USD 50,000, and another 35% required a agriculture (although agricultural companies ac- maximum of USD 120,0006 More than half of count for just 2% of Albanian business); 3% the companies said they needed the credit for of the work force were employed in the whole- investment purposes as opposed to working sale and retail trade sector, 8% in electricity pro- capital6 duction and the rest in other sectors like construction, services, etc This employment struc- Four per cent of companies had investments ture reflects the static situation of the country - worth USD 1 million, 38% less than USD an agricultural economy with short-lived enter- 125,000 and 40% less than USD 50,0006 prises mainly in the trade sector, with little im- Many companies use old or second hand pact on employment or production The legal technology and there are serious needs for and regulatory framework for the private sector financial help to upgrade equipment and pro- is subject to frequent changes, which makes the vide training6 The need is particularly acute in environment for the development of small and the manufacturing and construction industries medium enterprises unpredictable and hostile in order to comply with quality control require- ments6 The business community generally operates, Most products and services are for the do- without any serious market strategy or market mestic market6 research This ad-hoc haphazard approach com- Sales are very low6 38% of businesses achie- bined with the lack of national business devel- ved an annual turnover of between USD opment strategies, government incentives for 50,000 and USD 125,000 while 48% of com- enterprise zones and excessive bureaucracy has panies had an annual turnover of less than led to import-dependency Traditional manu- USD 50,0006 facturing capacity has suffered as well as the The interviewees described the laws and quality of new services and products Local pro- regulations as complicated and ever chang- duction is less competitive as a result and this ing6 Eighty four per cent said there had been has led to a chaotic free-for-all market domi- too many changes, while 78% said the law nated by monopolies As a result of this weak was too complicated6 and ad-hoc development, the enterprise econo- Women run only 8% of companies6 my is incapable of absorbing the labour force Results from a selective survey of private and Migration is widespread from areas where the state institutions, business associations, population sees no opportunity for regional banks, business consultancy firms and the development People may not find employment donor community conducted by the Human De- in the so-called "better off" areas, but at least velopment Promotion Centre in 1999: they can live with an increased sense of opti- mism that their situation might improve The legal framework for business needs

12 HUMAN DEVELOPMENT REPORT fine-tuning, especially the laws governing They blame a weak banking system, the competition, customs duties, taxes and the lack of political stability and public order law on employment and protection of infor the general reluctance to provide credit6 terests of employees6 60% of the interviewees want a more lib- Only about 30% of interviewees believed eral policy towards granting credit6 that the opinions of the private sector had 50% of banks said they had no strategy been taken into account during the process for giving loans to businesses6 of law reform6 80% of banks blamed business for not being The professional ability of civil servants credit worthy- they list poor business plans, who handle business issues is perceived weak business management, poor account- as low and there is duplication of efforts ing and insufficient collateral among the and an overlapping of responsibilities be- problems6 tween the ministries6 75% of the interviewees stressed the need Ten of the 13 donors, who collaborate with for small and medium enterprises to receive the Albanian Government to provide credit financial and legal support as well as mar- to small and medium size businesses, con- keting and management assistance so as to sider their programmes to be successful6 be able to prepare better business plans6

Foreign Aid and Public Investments In comparison to 1996-1997, money for projects for the health sector, rural and urban Foreign aid provides the bulk of public invest- infrastructure and enterprise promotion has ment in Albania By the end of 1999 foreign tripled and finance for projects developing in- aid had totalled over USD 27 billion, of which stitutional capacity and restructuring water and about USD 680 million was provided over the waste management systems has doubled In last two years The European Union and the total, 50% of the aid was spent on road and World Bank are the main multilateral donors, water supply infrastructure The level of finan- while Italy, Germany, USA, Greece and Japan cial aid is very modest, but the need for invest- are the main bilateral donors ment in the education sector is very high

Tab 3 External financing of the public investment programme in million USD

Financing agency Before 1996 1997 1998 1999 Total 1996 Multilateral: European Union 5505 575 623 620 1307 8630 European Investment Bank 371 132 243 * 746 European Bank for Reconstruction and Development 345 03 02 500 850 The World Bank 2391 629 296 570 1164 5050 Others 554 203 13 30 * 800 Total 9166 1542 932 1465 2971 16076 Bilateral: Germany 1223 530 46 267 99 2165 Greece 166 421 464 13 1064 Italy 2272 279 285 696 481 4013 Japan 457 291 12 25 40 825 USA 1977 49 * 2026 Others 1080 140 21 62 174 1477 Total 7175 1240 785 1563 807 11570 Overall 16341 2782 1717 3028 3778 27646

* not available in the data base dept The data in this table include all aid categories: Balance of payments, technical assistance, investments, humanitarian aid, food and commodity aid Source: Ministry of Economic Co-operation and Trade, March 2000

ALBANIA: 2000 13 The disbursement rate of funds is still low Only The limited capability and insufficient mo- 50% of the USD 24 billion granted between tivation of the institutions responsible for 1991-1998 have been spent The disbursement infrastructure project implementation6 rate is lower for infrastructure projects Delayed solutions to issues concerning property expropriation or tax exemptions Implementation of large projects according to and charges6 international standards is a difficult challenge Lack of co-ordination between donors and for Albania Efficient absorption of donors in- Albanian institutions6 vestment funds is hampered by inadequate ser- Lack of personnel at national and local level vices and manufacturing capacities There is also with the required skills to prepare and imple- insufficient institutional capacity and a lack of ment infrastructure projects knowledge and experience in the management The present Government has expressed its wish of large funds to enable all the aid to be ab- to change this situation6 sorbed Often the legal framework is either not known or misunderstood and the process is fur- Foreign aid will continue to provide the lion's ther hindered by bureaucratic delays, corruption share of public investment financing in Albania and a lack of transparency in procurement pro- during the period 2000-2003 In addition to the cedures Sometimes, the quality of foreign con- non-disbursed funds, negotiations will take place tractors is poor and there are cases where con- for supplementary financing of around USD tract funds have been abused, clearly demon- 400 million The greatest demand will continue strating that corruption in this area is not just to be for financing infrastructure development an Albanian problem The commitment of Al- banian governments to fight corruption and Fig 5 Requirements for new financing ensure transparency in the handling of aid has according to sector been considerable, but never enough

Health Has there been enough public investment? 9% Public Transport administration There is a widespread belief in Albania that the 28% 16% very poor state of infrastructure is due to a lack Legislation and of finance6 But a cursory look at the European justice Union's financing of the transport sector dem- 8%

onstrates that this is clearly not the case6 Ot her s 27% Water Tab 4 European Union finance to the 12% transport sector 1994-1999 in million EURO Source: Ministry of Economic Co-operation and Trade, PROGRAMME COMMITTED CONTRACTED DISBURSED March 2000 in million EURO % Phare Transport 56 40 7 125 12 Family living standards Cross-border The average Albanian family is poor and co-operation The average Albanian family is poor and has inadequate living space It is claimed (Albania-Greece) 62 45 17 274 that the average income is half of the Cross-border minimum income considered necessary co-operation to live Only one family in five thinks that (Albania-Italy) 42 26 6 143 it has enough resources for a decent life Total 160 111 30 188 Total 160 111 30 188 whereas two thirds of households say their economic situation is very difficult Source: Ministry of Economic Co-operation and Trade, March 2000 their economic situation is very difficult The average living space is 62 sqm per There is a lot more effort put into signing con- household and the possibilities of buying tracts than into supervising their implemen- a house are limited due to extremely tation6 Reasons for this include: high prices

14 HUMAN DEVELOPMENT REPORT Household income the pattern of migration from rural to urban Living standards are assessed by taking into ac- areas count a wide-range of inter-dependent social, economic, monetary and material factors In- Twenty per cent of households receive just 5% come is a key indicator and in the case of al- of the country's total wages, whereas 30% of most all Albanian families, the heads of the total income goes to 10% of families - household usually provide the main income Albania's wealthy class

Tab 6 Income of the head of the household According to a survey in which households evaluated their own financial situation, 60% said their economic situation was very difficult, 23% Unemployment said that it was difficult and 17% good or very Pensions and Salaries others good The income of the latter category is three 2% Others 26% 3% times higher than that of households in the first category Agricultural sector No income 7% In general, households estimate that they need 30% a minimum income of Lek 31,000/month to Salaries lead a decent life In less populated areas (under 24% 10,000 inhabitants) the average is Lek 28,000/ Self employment month, in more populated areas (over 10,000 inhabitants) the average is Lek 38,000/month Source: INSTAT Fig 8 Family financial situation (in %) According to a national survey conducted by INSTAT in October 1998, the main source of 0 income of more than half of the heads of 0 household (54%) is from salaried work in the under 10000 inhabitants state or private sector (including agriculture) 0 over 10000 One fourth are eligible for old age or invalidity inhabitants 0 pension and 7 % have no income at all 0

The average income per household is Lek 0 16,620/month In areas where there are less than 10,000 inhabitants, the average income falls to 0 Lek 14,250/month, while in areas of more than 0 10,000 inhabitants, incomes are higher at Lek difficult and very difficult a bit difficult good and very good 21,240 per month This disparity partly explains Source: INSTAT Fig 7 Average family income distribution

100 90 80 70 60 50 declared family 40 incomes incomes in % incomes 30 balanced income 20 10 0 0 102030405060708090100 families in % Source: INSTAT

ALBANIA: 2000 15 Meagre incomes mean that the majority of toilet or running water and in areas with fewer households lead simple and thrifty lives Only than 10,000 inhabitants, 75% of households live 15% of households earn enough to eat meat at without these facilities One fifth of houses are least once in two days, while only 18% buy new damp and a quarter have broken windowpanes clothes at least once a year Only 12% of households have enough money for a vacation of a About 36% of the houses have plastered walls, week or more in Albania or abroad Despite low 4% are constructed with prefabricated bricks and incomes, 56% of households entertain family 29% with stones In 51% of the cases, the alleys and friends at home But this is more indicative from the house into the main streets are not of the Albanian tradition of hospitality rather paved In areas of over 10,000 inhabitants, nearly than a sign of wealth half the overall number of households said that the environment around their houses is polluted, Tab 5 Income use in % whereas in less populated areas this is true for Use \ Population Under 10,000 Over 10,000 Total 18% inhabitants inhabitants One week vacation In Albania, 57,376 families are either home- per year 81 183 116 less, have insufficient housing space or have Meat consumption once had to return their house to ex-owners6 They in two days 108 236 151 comprise the following categories: Purchasing new clothes Families that live in houses that by every year 182 187 184 law have been returned to the Receiving relatives ex-owners 10,200 and friends 615 446 557 Families of the ex-persecuted Source: INSTAT and political prisoners 6,000 Families that live in cramped Housing and dire conditions 35,176 Families that lost their houses Sixty three per cent of Albanians live in their to the pyramid schemes 6,000 own house - the majority of which were occupied by the same families prior to 1992 About During 1944-1990, the state built about 25% of families live in apartments which were 220,000 apartments6 Private investors, local privatised under preferential terms in 1992 and and foreign, have made considerable invest- 95% of all housing has now been privatised ments in the housing sector over the last ten Eighty per cent of people living in their own years6 Newly built houses in cities now sell house belong to areas of fewer than 10,000 in- at around 300-600 USD/sqm6 habitants and almost two thirds of private houses have gardens The need for better hygiene and sanitation, as well as post-privatisation pride in ownership, The average family has two rooms to live in with have encouraged Albanian families to improve an average living space of 62m2 or 146m2 per their home interiors The trend is more pro- person with two people sharing a room Three nounced in areas of over 10,000 inhabitants, quarters of households have a separate kitchen where during 1998, about 32% of households carried out home improvements The most fre- Houses offer very limited comfort Less than quent works include a new WC, re-tiling and half of Albanian households have an indoor replacement of windowpanes

Tab 6 Housing situation in % Situation \ Population Under 10,000 inhabitants Over 10,000 inhabitants WC and running water inside the house 26,0 81,9 Leaking roof 225 154 Damp walls 214 173 Broken windows 239 263 Source: INSTAT

16 HUMAN DEVELOPMENT REPORT Fig 10 Mode of heating in the areas Material conditions of less than 10,000 inhabitants

Almost all Albanian families, about 93% of households, have a TV set Despite the expense, only 7% of the households do not pos- Wood Power 74% 22% sess one, but declare that they would buy one if they had the money About 12% of households have a VCR and 77% regard it as an important appliance, which they would buy if Gas they could 3% Kerosene 1% There is a clear difference between areas with regard to ownership of washing machines In Source: INSTAT

Tab 7 Household equipment in %

Under 10,000 inhabitants Over 10,000 inhabitants Total Black & white TV 399 128 303 Colour TV 549 867 656 VCR 79 199 120 Satellite dish 194 231 207 Refrigerator 592 898 695 Washing machine 126 682 314 Vacuum cleaner 44 274 122 Cooking stove (gas/power) 298 703 435 Hi-fi 68 142 93 Bicycle 164 250 193 Car 39 113 64 Telephone 31 311 196 Source: INSTAT more densely populated areas (over 10,000) families are five times more likely to own one Families use wood, electric power and gas This has to do with higher income level as well (LPG) for heating and cooking purposes In as access to running water areas of over 10,000 inhabitants, the number of households using electric power or LPG is Fig 9 Mode of heating in the areas double that of less populated zones where 74% of over 10,000 inhabitants of households use wood stoves for heating and cooking LPG is still seen by many as a novelty

Ownership of a telephone line is a very distin- Ker osene Gas guishing factor - where there are over 10,000 7 % Wood 10% 28% inhabitants, ten times more households have telephones In the same category of households, 11% have private cars and over half say they Power would like to own a computer, but cannot af- 55% ford one, whereas in zones of less than 10,000 inhabitants, a computer is regarded as an un- necessary luxury

Source: INSTAT

ALBANIA: 2000 17 13 Employment insecurity The first few years of transition were characterised by an immediate increase in the number The labour market of unemployed due to the collapse of many enterprises But during 1993-1996, registered The labour market in Albania is characterised by high unemployment fell continuously as the economy unemployment and a lack of investment to create the recovered and the number of small and medium enterprises grew During the 1997 crisis, many potential for a major increase in employment of the state and private enterprises were de- State policies on employment lack co-ordination stroyed and this had an immediate impact on and fiscal policies do not properly support an the labour market The increase in unemploy- accelerated development of the private sector ment figures was also related to the fact that The situation is exacerbated by informal labour, many jobless had not registered previously, be- lack of efficient labour market institutions and cause they had been receiving monthly payments a shortage of skilled labour from pyramid scheme investments After a continuous decline until 1996, the level It is difficult to make a full assessment of the of unemployment has increased year by year Albanian labour market using just the official and now remains at a high level In 1999, ac- data of the last ten years, for the following rea- cording to the Ministry of Labour and Social sons: Affairs, unemployment stood at 182%, with a total of 239,794 registered unemployed, com- A large part of the population is rural and pared to 177% in 1998 In addition, it is esti- mobile, which makes it difficult to identify mated that a further 7% of the unemployed are the unemployed The search for a common unregistered Continuing high unemployment denominator to define unemployment has poses obvious risks to maintaining macroeco- been the subject of intense and often con- nomic and social equilibrium and constitutes an troversial debate increasing financial burden on the state The existence of a large informal economy

Tab 8 Labour force and employment 1994-1999 in thousands Various external and internal factors have prevented private business (except in areas such as 1994 1995 1996 1997 1998 1999 Population 3202 3249 3283 3324 3378 trade, services and construction) from growing Working age and playing an important part in the economy population 1786 1820 1850 1861 1888 and labour market The main cause of unem- Labour force force1423 1309 1274 1301 1320 1322 ployment in the cities, along with the low level Total of employed of skills, is the massive migration of the popu- persons 1161 1138 1116 1107 1085 1082 lation from rural to urban areas Registered unemployed 262 171 158 194 235 240 Rates of unemployment 18 13 12 15 177 182 The low wages that characterise the Albanian Source: Ministry of Labour and Social Affairs, March 2000 market have not yet stimulated the attraction

Fig 11 Yearly unemployment

20 % 17.7% 18% 18.2% 15 13% 12% 15% 10

Unemployment rate in Unemployment rate 0 1994 1995 1996 1997 1998 1999

Source: Ministry of Labour and Social Affairs, March 2000

18 HUMAN DEVELOPMENT REPORT of foreign financing They have led to a decline Social protection in the professional level of the labour force, as well as encouraging emigration of skilled labour Unemployment benefit, regarded as social in- and, above all, well-educated people This mas- surance, is paid to individuals for a maximum sive loss of human resources means that the eco- of one year During 1999, approximately 24,000 nomic situation is unlikely to change rapidly people benefited from this scheme compared to 25,000 in 1998 The volume of informal labour is huge, although no official figures exist While for a time the Social protection includes the social assistance phenomenon may have served as a means of that is given to the most vulnerable families, who reducing labour costs and alleviating social prob- have no income or too little to live on During lems by generating employment, the scale of 1999, about 145,000 families or 17% of fami- unregistered labour is now so large, that it is lies in Albania received social assistance Of these expected to cause problems in the future The families, 49% lived in urban areas and 51% in large contingent of uninsured today will create rural areas a great burden for social assistance and welfare programmes Albanian society will have to pay Social Policies a high cost to reduce poverty in future years The high level of unemployment has highlighted the need to Albanian labour market offers limited possibili- develop active employment policies, in particular for young ties given the poor qualifications of the unem- people, women and workers from industries that have closed ployed While 48% have finished middle school down6 and 49% have finished high school they need vocational/re-training programmes to do quali- Although, the country has had various social protection fied work But training opportunities in terms programmes for many years, a large part of the population of quantity and quality are very poor The only remains without coverage or excluded from the schemes6 progress is the establishment of several private Fifty four per cent of the unemployed currently receive so- centres, mainly for foreign languages and com- cial assistance and 9% receive unemployment benefit - but puter courses But these centers charge high fees that leaves 37% of the jobless receiving nothing at all6 and have little impact on employment There are also few options for women in the labour Countrywide,145,000 families are eligible for social as- market Currently the female unemployment rate sistance, 1000 persons (the elderly and abandoned chil- is 21 % compared to 15% for males dren) receive care in social state residences/centres and about 3,800 people receive special care6 These citizens In the last few years, the Government has un- are passive recipients6 While large amounts of money are dertaken several steps to improve the situation spent on helping the needy, there is nothing done to help by financing various employment initiatives, in- these citizens get back to work or participate more in com- cluding the programme of public works and munity/public life6 employment promotion through co-operation with private business These projects have cre- During 1998-1999, the National Employment Service imple- ated new employment, especially the public mented the Public Works Programme, to help alleviate pov- works projects in rural areas, which were under- erty and reduce unemployment levels in different parts of taken in 1998/1999 the country6 According to official data, the state spent Lek 1,513 million on the implementation of 729 projects pro- Employment promotion projects have also viding jobs for 46,500 unemployed6 1999 marked the be- helped create private enterprises and employ- ginning of the Employment Promotion Programme by which ment within this sector These projects were imple- the Government provided subsidies to employers to gener- mented in the second half of 1999 and are ongo- ate new employment and provide vocational training to em- ing However, many of these jobs are seasonal ployees6 According to government figures between 1999 and March 2000, Lek 465 million has been spent generat- There is an evident need for institutions to being 10,000 new jobs6 Each new job costs the government come responsible for further analysis of the situ- approx6 Lek 4,550 month/person6 For the year 2000, the ation, and for the development and implemen- state budget has allocated Lek 500 million to this tation of policies and strategies in this area programme6

ALBANIA: 2000 19 During 1999, 260,000 people received an old 1991 saw the start of wage increases in the most age pension: 48% received on average Lek important economic sectors A new wage was 4,100, 28% on average Lek 4,600, 10 % on av- introduced for state employees comprising 22 erage Lek 5,000 and 14% an average of Lek categories based on a job evaluation, which 5,200 The number of invalidity pensions for looked at the nature of the work, responsibili- 1999 was approximately 26,000 with an aver- ties and difficulties This new system marked age pension of Lek 4,000 the beginning of the process of differentiation between wages for qualified and unqualified There is also a social protection scheme for the work By the end of 1993, the payment ratio disabled It covers the mentally disabled since between the lowest and highest wage was 1:4 birth and those unable to work During 1999, compared to 1:2 at the end of 1989 about 31,000 individuals benefited from this scheme and received a pension of Lek 4,000 For the first time, during 1992 - 1994, state sec- These pensions are not enough to live on tor wages were revised twice a year to reflect changes in the retail price index Furthermore, Wages payment for food allowance and electricity and fuel allowance was added to state wages to com- During the last decade, wage levels have changed pensate for the liberalisation of prices of these continuously Until the end of 1989, wages were commodities the only source of income for all the working population and they were determined by the The working week was reduced from six days state according to a fee system based on the to five, which helped increase the wage per hour quantity and quality of work undertaken for civil servants

1991 marked the start of efforts to transform The average monthly salary of a civil servant by the centralised economy into a market economy the end of 1994 was eight times higher than in The implementation of a complex programme 1990 while the minimum official wage was three of overall economic reform and restructuring and a half times higher The average wage of a began step by step and wages which were such director was twice as high as that of a worker an important part of monetary and social policy But in the meantime, the retail price index had had to be revised in accordance with the new increased by a factor of ten Consequently, by economic environment Given the country's the end of 1994, real wages of employees fell specific situation, this had to take place gradu- by more than 16 per cent ally beginning with an increase in exceptionally low wage levels and then the formation of a In 1994, the average monthly output for one more appropriate wage system employee was worth Lek 12,800, while the average monthly wage was Lek 4,778, just 37 % Fig 12 Average wage and Consumer of the average monthly output Price Index (CPI)

250 Change in average wage

200 Change in consumer price index (CPI) 150 Real wage growth

100

0 1991 1992 1993 1994 1995 1996 1997 1998 1999 -50

Source: INSTAT, May 2000

20 HUMAN DEVELOPMENT REPORT During 1995 -1997, there were no changes in In 1998, state wages were raised by an average salary levels This was due to the bad economic of 20% The minimum wage was approxi- situation and the closure or destruction of many mately Lek 5,800, eight times higher than in enterprises By the end of 1997, the average 1990 The average monthly wage for a state wage was 17 times higher than in 1990, but employee was about Lek 11,000, but employ- prices were almost 19 times higher This repre- ees working in banking and public administra- sented a 17% fall in the value of the real wage tion earned approximately double By the end This reduction had a serious effect on living stan- of 1998, wages and prices were twenty times dards higher than in 1990

Tab 9 Average monthly wage according to sector (October 1998) in Leks

Sector Average wage 1 Employee in : - state sector 10,735 - agriculture private sector 4,755 - non-agriculture private sector 13,286

2 Self-employed in: - agriculture private sector 5,146 - non-agriculture private sector 18,575

ALBANIA: 2000 21 Chapter II SOCIAL INSECURITY

21 The citizen and the state it's legacy of social problems and low economic development Yet, it is widely accepted that one A weak state which cannot provide of the most serious impediments to Albania's security for its citizens development and stability in the post-communist period is the weak state Despite visible improvements in security over In the case of Albania, the weakeness of the the last two years, Albania is still regarded as a state is substantial and deep rooted A weak state country with high crime and low levels of social, is one that cannot implement or enforce the law, political, and economic security Many attribute is unable to formulate and implement devel- the insecurity and instability to the dramatic and opment policies, cannot collect taxes and is un- violent events of 1997 that followed the col- able to provide its citizens with the most essen- lapse of the pyramid schemes, where a large part tial public services or the means to participate of the population had placed its savings 1997 in public life A weak state is a state which can- was a catastrophic year - the state completely not exercise its primary function of social con- collapsed plunging the country into anarchy and trol and therefore fails in its duty to protect and chaos with dire consequences: many killed and care for its citizens wounded, extensive material damage and massive armament of the population State weakness characterises the entire period of Albanian transition During the events of The military depots were looted during the an- 1997, it took on alarming proportions and it archy of the spring of 1997 and thousands of continues to be the key underlying factor of weapons of all kinds fell into the hands of the collective and personal insecurity civilian population Despite a series of measures undertaken by the Government of Albania, in- State weakness characterises the entire period cluding the implementation of a very success- of Albanian transition During the events of ful UNDP pilot project in the district of Gramsh 1997, it took on alarming proportions and it (lately extended to Elbasan and Dibër), disar- continues to be the key underlying factor of mament on a countrywide scale and an effec- collective and personal insecurity tive solution to the problem requires much further time and effort The armed population is an important contributing factor to the lack of State and politics security and stability in Albania Without going into a detailed analysis of the fac- Although the dramatic and violent events of tors and reasons that brought about the weak- 1997 marked the climax of the breakdown of ening of the state in post-communist Albania, Albanian institutions, the crisis began long be- one of the key factors that should be reviewed fore those events Even in 1991 and 1992, the is the role of politics in the overall state of country had its first taste of anarchy when vio- insecurity that characterises this period6 lent outburst greeted the collapse of communism, which everyone identified with the state Continuous and radical change in Albania during the 90s has undoubtedly led to psycho- The reasons behind the Albanian crisis are many logical insecurity for a large part of the popu- and complex They are related to the country's lation6 This is a typical characteristic of tran- historical heritage as well as the terrible conse- sition experienced by all ex-communist coun- quences of half a century of Stalinist rule and tries6 But insecurity has been exacerbated by

22 HUMAN DEVELOPMENT REPORT the adversarial nature of Albanian politics, eral model, which would allow the state to rap- which has caused constant tension over the idly relinquish many of its functions, created an last ten years6 administrative void Although there were many achievements during this period, the adminis- After 1990, the Albanian citizen acquired a num- trative vacuum created by the collapse of the ber of fundamental political rights and the coun- communist system has not been filled Given try took a series of important steps towards es- the number of cases of mismanagement, cor- tablishing democratic institutions6 But, the ruption and the improper functioning of the polarisation of political life and attitudes, police and especially the judicial system, it is not adversarial policies, the lack of dialogue and the suprising that the sense of mistrust towards the promotion of a culture of intolerance have im- state and institutions has been growing and that peded stability in the country and promoted in- people take the law into their own hands As a security among its citizens6 Many see emigra- result, in particular, there has been a revival of tion as the only way out of this situation6 revenge killings and vendettas

The growth and consolidation of Albanian demo- Society relies on a judicial system that works - cratic institutions has been hampered by an in- and the need to sort out the Albanian judicial ability to make a clear distinction between the system should therefore be a top priority De- state and the government of the day and con- spite being discussed for years, there has been fusion over their respective powers, by efforts no change and the failure of the judicial system to control the justice system and, by the popu- to function exacerbates the overall sense of in- lism that often caracterises Albanian politics6 security in Albanian society

Despite efforts, there is still no modern or The approval of the new Constitution of Al- well-functioning public administration, which bania in 1998 (a number of international insti- is essential for the countrys effective transi- tutions helped with the drafting) and the sign- tion from one political and economic system ing of the European Charter of Human Rights to another6 In a large part, this is due to a men- were important steps forward in the consoli- tality, which politicises everything and places dation of Albanian state institutions But there party interests before the state6 remains a serious discrepancy between the law as it is written and its enforcement The judicial The state and governance Fig 13 How do you consider the work of the Government during the last 2-3 months? There are many reasons why there is no social contract between the government and citizens in Albania While historical heritage and the catastrophic consequences of communism are partly to blame, the manner in which the country has 180 been governed in the last ten years as well as the 160 way in which the political and economic model Left Center Right Apolitical 140 for Albania was conceived, are also very significant factors 120 100 Capitalism was often perceived as a game with 80 no rules, where getting rich justified breaking 60 the law and where participation in politics was sometimes seen as a fast way to prosper While 40 this kind of capitalism created dynamism, it also 20 encouraged mass idleness by promoting the 0 mentality that one could get rich quickly through bad illegal means without really having to work good not average The pyramid schemes were part of this logic bad very interested no answer very good very don’t know don’t

On the other hand, the adoption of a new lib- Source: National Early Warning for Albania, UNDP, December 1999

ALBANIA: 2000 23 system and the need for reform are one of the officials surveyed said that bribery is ex- biggest challenges facing Albania today There tremely prevalent in Albania are serious problems with the political indepen- According to public officials, more than 50% dence of the system, the professionalism of the of customs inspectors "purchase" their po- judges and prosecutors and above all, the cor- sitions ruption which eats away at the heart of Alba- 25% of private citizens who have a sick fam- nian justice ily member admit to paying bribes to health officials The contribution of international institutions is crucial to the efforts being made to strengthen Stability Pact and the anti-corruption state and government But this assistance and initiative the special attention given to Albania have not An anti-corruption initiative was announced as helped to create a long-term vision of devel- part of the Stability Pact at the Istanbul Summit opment There is a tendency to think of gover- in November 19996 It defined three groups of nance as a partnership with foreigners rather objectives (economic, public integrity and civil than management of the needs and concerns society) and it outlined the commitments that of the public and the country governments in the region should undertake to combat corruption: Isolated corruption in Europe or part of The adoption and implementation of Euro- European corruption? pean and other international protocols and standards, in particular those of the Coun- Corruption is one of the most visible evils of cil of Europe, European Union, Organisation the Albanian transition According to a survey for Economic Co-operation and Develop- in 1999, based on an indicator that ranks coun- ment, the United Nations and the Financial tries from 0 (very corrupt) to 10 (very honest), Action Task Force on Money Laundering6 Albania was the most corrupt country in the Promotion of good governance and efficient region Of 99 countries rated worldwide, Al- public administration through implementation bania was the 16th most corrupt of reforms that would ensure transparency Tab 10 Recent survey on corruption and control of public administration, through development of institutional capacities and Countries Corruption indicator Country rank high standards of public service ethics for (from 0 to 10) (among 99 countries rated) public officials6 Hungary 52 31 The strengthening of legislation and promo- Bulgaria 33 63 tion of rule of law by ensuring a true separa- FYROM 33 63 tion of the executive, legislative and judicial Romania 33 63 powers establishing independent and best Croatia 27 74 practice investigative capacities6 Albania 23 84 But the nature of corruption is, at the same time, the subject of great political speculation in the Source: Transparency International, October 1999 country and abroad This is because Albania is Results of a 1998 World Bank survey indicate not unique - there are many other countries with that: the same problem and the phenomenon is not More than half of the firms surveyed ad- limited to any one particular government The mit that they pay bribes to public officials lack of a permanent monitoring system makes Corruption costs these firms approximately the scientific evaluation of the evidence very dis- 7% of their turnover putable That is why the very strict approach Most bribes to public officials are paid by towards this phenomenon sometimes appears trade and construction companies 75% of to be based on a concern for political position- these companies admit to paying bribes ing rather than a true and genuine willingness to almost 50% of private citizens admit to pay- fight corruption ing bribes since 1991 Public officials confirm that corruption is pervasive: more than two-thirds of public

24 HUMAN DEVELOPMENT REPORT 22 Health Protection problem for the health sector is the lack of financial resources Despite recent increases in the health budget (25% of GDP in 1999), this is still Public health in Albania faces both way below the level of health budgets in Euro- inherited and new problems The most pean Union countries (73% of GDP in 1999) serious problems have to do with the dilapidated infrastructure, the lack of About 80% of deaths in Albania are caused by pharmaceuticals and medical supplies 4 or 5 main groups of diseases - mainly cardio-vascular and the poor financial incentives for and respiratory diseases The latter are the cause of health professionals Much effort has 45% of deaths in 1998, against 13% in 1994 been made to solve these major prob- The incidence of death by unnatural causes has lems, but a lack of financial resources increased In 1998, 1084 persons died of unnatural continues to prevent real change causes - three times more than in 1994 Between 1996 There is also a tendency for people to and 1997, this figure increased by 100% Murder travel abroad for diagnosis and treat- and car accidents have been the main causes of ment, including for ailments that could approximately 95% of such deaths be treated here given the professional level of Albanian doctors Primary health care comprises 637 health centres and 2,327 dispensaries nation-wide, all of General health indicators in Albania require care- which employ 1,557 general practitioners who ful analysis Some indicators compare Albania are contracted by the Albanian Health Care In- favourably to its European counterparts Life surance Institute The Institute also contracts 761 expectancy is 722 years, which is slightly below pharmacies/pharmaceutical agencies that are in the average for Western Europe but above that charge of the population's pharmaceutical in- of other countries in transition This is prob- surance According to a study conducted by the ably due to peoples diet and lifestyle and the Ministry of Health, it is estimated that the num- climate But this indicator needs reassessment ber of health centres will soon decrease to given the recent increase in deaths by car acci- around 510 centres nation-wide dent and gunfire, especially among young people During the last ten years, primary health care Immunisation levels of the population are also has suffered serious problems due to poor fi- good In 1998, approximately 97% of children nancial incentives for staff, very bad infrastruc- were vaccinated against polio, 96% against diph- ture, and a lack of medical supplies and equip- theria, tetanus and whooping cough (trivaccine), ment These problems are even more acute in 89% against measles and approximately 87% of villages and remote parts of the country children against tuberculosis There are 10,237 hospital beds spread among While official statistics on infant mortality, al- 51 hospitals nation-wide In general, hospitals though incomplete, show that the rate is declin- and services are in poor conditions due to lack ing (205 per thousand during 1998), it is still of drugs and laboratory supplies, dilapidated among the highest in Europe The maternal facilities, outdated medical equipment and a mortality rate (257 per 100,000 births) is also shortage of water, electricity and heating on the decline, but, still higher than in other European countries According to 1998 data, In Albania, there are 13 physicians per 1000 the birth to abortion ratio was 31/1 inhabitants - a low figure compared to 3 physicians per 1000 inhabitants in the European Despite the positive indicators, health authori- Union and 25 physicians per 1000 in Eastern ties have identified the following public health European countries There are approximately concerns: a growing incidence of diseases, a de- 16,000 nurses and midwives in Albania The terioration in living conditions, dilapidation of main problem affecting staff is the migration health structures, low quality of service delivery of key health personnel from the remote moun- and a lack of health specialists many of whom tainous areas to urban areas have emigrated But, the most fundamental

ALBANIA: 2000 25 The health service has to tackle new problems for which A new teacher training programme was es- it has little experience: drug abuse and sexually trans- tablished between 1994 and 1996 This in- mitted diseases Not only has there been a re-emer- volved central trainers instructing district gence of eradicated diseases such as syphilis and trainers who in turn instructed teachers The gonorrhoea, but there have also been 53 reported cases programme now operates on a nation-wide scale through the district education director- of HIV in Albania since 1993 Eleven cases have devel- ates and is continuously expanding The oped into AIDS and ten of these patients have died The former High Institutes for teacher training, fact that the incidence of HIV positive patients is low were transformed into universities, which are does not mean that AIDS will not be a problem in Alba- now making efforts to re-organise so that nia All the right conditions are present for the spread of they can better serve their purpose the disease (emigration, low level of education, prostitution, etc) including the fact that Albania has inadequate Changes to the administrative structure of blood screening and public awareness programmes, in the education system - although confused and particular in rural areas The fight against AIDS is lacking long-term vision During 1992, re- hampered by organisational gaps regarding diagnosis, sponsibility for education at local level was voluntary testing and the legal framework centralised, passing from the district Execu- tive Committees to the Education director- ates of the Ministry of Education At the The annual fund of the Health Care Insurance school level, recent efforts have been made Institute, which was established in 1995, is made to increase community and parent partici- up of a state contribution of 49% and a citizen's pation in the school decision making pro- contribution of 51% The institute insures 68% cess But so far the idea exists more on pa- of the population, including 88% of state em- per than in practice ployees, 56% of private sector employees and 3% of farmers But one of the Institute's main Universities have become autonomous insti- problems is that the collection of contributions, tutions Although the legal process began in in particular from farmers, is very low Improve- 1994, free university elections were held for ments in the collection are expected to have an the first time in 1999, precisely when the new impact on the expansion of primary health care law on autonomy became effective The cur- insurance schemes, as well as hospital insurance rent legal framework should allow for increasing self-governance and an improvement in university efficiency 23 Education Private education is now a reality in Albania Fundamental changes Two thirds of private schools were established in 1995 with foreign money and in the last two Efforts to introduce changes to the Albanian years investment in this sector has grown To- education system began in the late 1980s But day, there are 31 kindergartens, 8 elementary because of the political climate and the admin- schools, 2 middle schools, 18 schools including istrative system of the time, they were limited elementary and middle cycle and 15 high schools mainly to the development of contemporary These schools are wholly funded with foreign school curricula and teaching methods in the money At present there is no legal means to sciences, such as maths, physics and chemistry introduce co-financing with public funds Pri- There was also discussion on the principle of vate schooling is expected to grow and be- introducing 10th grade compulsory education come a significant part of the education system Over the last decade, the most fundamental in Albania changes to the education system include: The challenges Changes to the curricula, in particular, in social sciences Within a few years, new texts During the last few years, the Albanian educa- devoid of political propaganda were pub- tion system has faced numerous difficulties as a lished and contemporary subjects and teach- result of transition The principal problems in- ing methods were introduced clude:

26 HUMAN DEVELOPMENT REPORT Teachers perception of school as well as the State financing of the public education system management of human resources has been a constant 9-10% of public expenditure annually for the last ten years, approximately 3-4 % Changes in curricula which create an added of the GDP Seventy five per cent of this financing goes workload for teachers and need to be bet- to salaries and just 9 % towards investment Local ter distributed throughout the school year government has committed only a small part of its Education is too reliant on textbooks and resources to education There has been an increase in there are few other alternative resources funding from the private sector, mainly from parents and communities, but the amounts remain small and are not The current manner of administration and included in the official statistics Lack of investment decision making does not guarantee efficiency funds has been partially compensated by foreign aid and generates big discrepancies between the This has mainly been spent on school rehabilitation, financing of education in urban areas and development of curricula and teacher training rural areas For example, it costs USD 29

Tab 11 School attendance (in thousands) 1989-1990 1991-1992 1994-1995 1996-1997 1998-1999 1999 compared to 1989 in% Kindergarten 125 109 80 84 82 656 Middle school 551 540 551 561 553 1003 High school 203 147 94 93 102 502 University 26 28 28 34 39 150 Total 905 824 753 772 776 857 Source: INSTAT

per year to educate a student in Tirana, USD All these shortcomings have affected the quan- 59 to educate a student in the municipality titative indicators In 1999, 14% fewer pupils of Burrel and USD 107 for a student in a attended school compared to 1989-1990 The commune of Mat district biggest drop was recorded in high schools where there has been a 50% decline in atten- There are also issues regarding the efficiency dance and in kindergartens, which have seen a and other aspects of resource management 34% decline The number of children attend- concerning preparation of textbooks, invest- ing middle schools remains the same, while there ments and maintenance of buildings, includ- has been a sharp increase in the number of uni- ing allegations of corruption versity students

Very high demands are being placed on the Al- More than half of the children in the 3-5 year banian educational system, yet there is a serious age group do not go to kindergarten This is lack of material, financial and human resources largely due to an absence of kindergartens in The result is a sharp decline in the recruitment rural areas and the fact that many mothers in of teachers, mainly due to very low wages Many urban areas are unemployed and stay at home graduates in education seek employment else- The fact that only 39% of youth in the 14-17 where and there is now - in rural areas particu- age group attend high school can be attributed larly - a serious shortage of teachers with basic to a declining interest in school, in particular in qualifications There is also a shortage of schools, rural areas, as well as to emigration especially in big urban areas, where there is an average of 45-50 students per class Combined It has been almost impossible for the under- with the lack of financial resources for rehabili- funded education system to respond to the tation, this situation suggests a poorly consoli- large-scale migration of the population towards dated education system the coastal areas and big cities and the inflexible

ALBANIA: 2000 27 Tab 12 Education according to age groups in % 1990 1994 1997 Male average Female average Children (3-5 years) at kindergarten 57 37 36 35 37 Children (6-13 years) at middle school 100 97 96 97 94 High school students (14-17 years) 79 40 39 42 36 University students (18-25 years) 10 13 15 14 17

Source: INSTAT

administrative system has been unable to real- try, in Albania they face all sorts of prejudices locate quickly and efficiently human and finan- and challenges cial resources As a result, schools in big urban areas are over-crowded, the drop-out rate is In general, young people in Albania live in a high and illiteracy especially in younger age society "contaminated" by deep and long-term groups is growing economic, political, psychological and cultural

Tab 13 Differences in education in urban and rural areas

Urban areas Rural areas Staff Staff large number of students per teacher small number of students per teacher (student overcrowding) (too few students) better qualified teachers who can teach less qualified teachers who have to give lessons the subjects they know in subjects they do not know not enough jobs for teachers lack of teachers training opportunities very limited training opportunities Materials Materials better quality of buildings, but insufficient space buildings in a poor state better quality of teaching materials, poor quality of teaching materials and limited but insufficient quantity quantity per student Financial expenses Financial expenses low average cost per student high average cost per student bigger possibilities for financing from very limited possibilities for financing from parents or other private sponsors parents or other private sponsors Performance Performance higher standard of teaching and student performance low standards of teaching and student performance increasing access to information and private tutorials lack of access to information and private tutorials high interest of parents in education declining interest of parents in education polarisation of pupils performance into high and uniformity of performance - mainly average or low achievers low achievement certain degree of monitoring of pupil and school insufficient or non-existent monitoring performance

24 Youth in search of more space crises Currently, the majority of Albanian youth live in worse economic conditions than their During the last ten years, the proportion of counterparts in developed countries in Europe young people in the population has declined sig- and elsewhere Most of them, even university nificantly According to official data, from 1989 graduates, earn inadequate money to survive until 1998, the proportion of 15-29 year olds They cannot afford to buy or rent basic accomo- fell from 289% of the population to 236% dation In these circumstances, many have opted While young people are the future of the coun- to leave Albania This category of emigration is

28 HUMAN DEVELOPMENT REPORT prompted by economic considerations rather many and other countries, whose parents than a crisis of confidence earn considerable income from private activities in Albania This category of youth Different surveys have shown that compared aims to assert itself by achieving more, or at to their counterparts in other Eastern European least doing something different from their countries, Albanian youth are more optimistic parents Many of them attend universities and confident in their future In general, Alba- or undertake post-graduate studies in engi- nian youth are motivated by a strong ambition neering, medicine, economics, law, etc, which to assert themselves economically, culturally and are considered high income and prestige pro- socially fessions in Albania and abroad

Many youth look to education to better them- Several surveys conducted in Albania by the selves This is reflected in the rapid increase of Faculty of Social Sciences during the last 5- the number of youth continuing university, even 6 years have demonstrated that Albanians, though Albania offers little by way of employ- and in particular, youth, have a highly devel- ment In the 1991-1992 school year, 10 % of oped competitive spirit In one survey, 94% 18 -22 year olds enrolled in University This per- of high school and university students ad- centage has grown to 15% in 1998-99 It would mit that the tougher the competition the be even higher if the youth who study in uni- more they want to win Perhaps as a result, versities abroad, were included Most students young Albanians, despite the problems as- work to pay for their studies Sixty per cent of sociated with emigration, compete success- the students who attend university part time are fully in foreign schools Yet, in the struggle women The number of female professors to succeed, young Albanians tend to treat teaching in universities has increased from 269% their rivals with respect In many cases, they in the 1994-1995 school year, to 358% in the assist friends, relatives, compatriots and for- 1998-1999 school year eigners who are in difficulty 72% of high school and university students consider it Youth assert their personality in different ways: important to be altruist and help others

Many youngsters are involved in private busi- Experience demonstrates that a practical and ness in Albania and for the most part they rational spirit plays an important role in the deve- engage in trading They do not pay enough lopment of a market economy Comparative ana- attention to their progress in school, espe- lysis conducted in Italy shows that young Italians cially in subjects like natural sciences, engi- and Albanians present the same traits in this regard neering and agricultural sciences, as they do not see their future as having anything to do with these disciplines Instead they put their 25 Criminality- a difficult faith in business challenge

Other young people emigrate, not only to Albania's geographical situation, the war in Kosovo, ensure their survival, but also to "become lawlessness and the lack of means to combat somebody" In general, they emigrate ille- crime has turned the country into a highway for gally, often putting their lives in danger by trafficking from the East to Western Europe taking difficult land routes into Greece or by crossing the Adriatic in speedboats Many Crime has grown substantially during the transi- young Albanians take such risks for reasons tion period and has been aided by the events of self-esteem In surveys conducted among of 1997 and the Kosovo crisis During the high school and university students over the Kosovo crisis, a large number of policemen last five years, personal dignity is rated higher were used to escort humanitarian aid and refu- than ten other key values including wealth, gees from Kosovo, allowing the activities of altruism, tolerance, patriotism, competitive criminals to go unchecked spirit and pragmatism However, intensive police action during the sec- There are many youth in Italy, Greece, Ger- ond half of 1999, in particular in the so-called

ALBANIA: 2000 29 "hot areas" of Shkodra, Vlora and Tropoja, has moment, it is impossible to know the accu- radically changed the crime situation and helped rate number of people charged with car theft restore, to a large degree, public order Ac- since the Criminal Code does not specifically cording to the Ministry of Public Order, crimi- provide for car theft There is only one article nality in Albania during 1999 was 73% lower about theft in general terms Police sources than in 1998 and a reduction of 310 penal cases say that out of 132 car theft cases, 61 occurred was recorded in big cities The Police caught 61% of the criminals Four car thefts during 1999 resulted Fig 14 What is your opinion on the work in the deaths of their owners of the police during the last 2-3 months? Organised crime - increasingly sophisticated

not interested Organised crime is now prevalent in the north of Albania as well as the south where it became don’t know established during the anarchy of 1997 Albania's no answ er problems, in general, and the Kosovo conflict

much aggravated have helped organised crime to grow Official data does not throw much light on the phenom- aggravated enon because there have been few studies of no change the criminal elements The lack of statistics is

improved partly due to poor data gathering, but also due to the difficulty of identifying organised crime much improved While data from the prosecutor's office shows 0 50 100 150 200 250 no incidence of organised crime, there's no doubt that the latter is responsible for most of Source: National Early Warning for Albania, UNDP, December 1999 the trafficking, prostitution and fraud

According to Police sources, murder was the Criminal groups have a hierarchy and in most most common crime in 1999 There were 460 cases the bosses keep out of the limelight Most committed, 203 of them in cities Sixty five per members of the gangs are either friends or blood cent of the guilty parties were apprehended by relations In the case of illegal business activi- police There were 340 attempted murders, 186 ties such as tobacco, coffee, oil or drugs, the of them in the cities Many of the criminals and bosses are important persons They often act in victims are young people between the age of 14 collaboration with customs officers and police- and 18 Blood feuds, vendettas and property is- men Very often, the bosses are Greek, Italian, sues are cited as motives for crimes Other crime Turkish, Bulgarian or Macedonian nationals, and statistics for 1999 include 2 bank robberies, 132 sometimes they come from as far afield as Latin car thefts, 61 instances of prostitute trafficking America or China The groups are often based and 60 instances of kidnapping This fight against in their cities of origin, except for when they crime, in the course of which about 40 crimi- are involved in drug or human trafficking For nals were killed, has helped the police gain cred- example, in the case of illegal emigration to Italy, ibility in the eyes of the citizens However, one group members include both Italians and Al- hundred and sixty policemen have lost their lives banians during the last three years Armed robbery and kidnapping Car theft The incidence of armed robbery has grown Car theft became an alarming phenomenon dur- considerably, in particular during the Kosovo ing 1999 The most "attractive" cars were of crisis Victims included property owners as the Mercedes Benz brand Cars stolen in well as humanitarian aid escorts In some neighbouring countries were collected in Bul- cases, armed robbery resulted in murder garia and transported to Albania, where they During 1999, police eliminated approximately were supplied with false documents At the 40 persons involved in armed robbery and de-

30 HUMAN DEVELOPMENT REPORT tained 812 persons for illegal possession of and Kurdistan wanting to reach Italy by sea arms, 468 in the cities But only 28 of these Usually they enter Albania via Montenegro, were charged Macedonia or Greece and up to now, it is estimated that 35,000 people have followed this Kidnapping of children of wealthy business- route There is also traffic from Asia via Rinas men and parents is on the increase In 1999, airport 60 people were kidnapped (33 in the cities), of which 25 were foreigners Police solved During 1999, approximately 200 clandestine immigrants were detained Currently, because 56 of these cases of the lack of infrastructure, the biggest issue is the control of the Greek border To this end, a Evidence from 1998-1999 demonstrates that new border police structure has been established many criminals from Turkey, Macedonia, with foreign assistance, and a couple of bilat- Montenegro, Kosovo and Italy were involved eral agreements have been signed with neigh- in illegal activities in Albania Relations between bouring countries criminal groups in the region are getting more and more sophisticated Women and children - victims of organised crime It is very difficult to estimate the number of criminal groups or their members But recently, During the last few years, the phenomenon criminal gangs have been fighting each other and of women trafficked for prostitution from the police are engaged in an intensive campaign Moldova, Lithuania, Russia, Bulgaria, and Ro- to control these elements mania to Western European has become increasingly visible Given the size of the problem, the Ministry of Public Order has estab- Human traffic lished special police units to track down those responsible During 1999, police handled 51 Since 1991, there has been a massive illegal mi- cases of women trafficked for prostitution and gration of the Albanian population into West- sexual exploitation The trafficking networks ern Europe This influx is closely related to pov- use many different routes but most of the erty and unemployment There has also been a women and children are brought into Albania lack of police manpower, expertise and finance from either Montenegro or Greece and al- to control it most all end up in Italy Over 37% of the prostitutes are thought to be minors During 1999, according to unofficial data, most of the clandestine emigrants leaving Albania Albanian networks purchase "the Eastern girls" were non-Albanians More than 50% of those from groups that control the traffic in Montene- reaching Italy were Kosovo Albanians and Roma gro, Macedonia and Greece to resell them in fleeing from the war, as well as Kurds and Chi- Italy In Kuçova, in central Albania, the head of nese The Kosovo conflict gave the networks the police crime department was arrested for who control the human traffic a good oppor- being involved in the traffic and allegations of tunity to expand and some Albanians passed involvement have also been made against other themselves off as Kosovo refugees in order to policemen be allowed into the West Statistics show that approximately 10,000 Kosovars left Vlora ille- The success of the traffic depends on the scale gally for Italy, making this a very lucrative busi- of collaboration between criminal groups in ness for the owners of the speedboats The indifferent countries Thus Russian and Moldovan creased human traffic also created opportuni- women come over the borders from Monte- ties for the traffic of goods negro and Serbia Statistics show that since July 1999, 126 women (including 19 from Moldova, Sources from the Ministry of Public Order say 19 from Romania, 5 from Bulgaria, 4 from Rus- that human trafficking is one of the most seri- sia and 1 from Ukraine) who came to Albania ous problems of the police More and more for prostitution purposes were repatriated But clandestines are coming overland from China while the daily press is full of stories about the

ALBANIA: 2000 31 activities of traffickers and the Albanian public co-operation with the "Southeast European is well aware of what is going on, there are very Co-operation Initiative" (SECI) and the Ameri- few arrests The trafficking of women is as lucra- can FBI, exchange information in the fight tive and competitive as the smuggling of drugs against cross-border crime

Although prostitution is relatively new to Alba- The security table of the Stability Pact for the nia, the country is among the main suppliers of Balkans, in which Albania takes part, has a num- prostitutes to neighbouring countries The number of priority projects to fight organised crime ber of Albanian prostitutes is estimated to be in the region The Ministry of Finance is work- approximately 15,000 in Italy, 5,000 in Greece, ing to fight economic and financial crimes, fis- and about 100 in France To fight this form of cal evasion and corruption with the assistance of illegal activity, which often goes hand in hand the European Union Customs Assistance Mis- with other forms of criminality, great efforts sion (CAM), the Italian "Guardia di Finanza" and are being made to increase the professionalism the Multinational Advisory Police Element of law enforcement authorities, as well as to (MAPE) raise public awareness

Albania takes part in a number of regional 26 Drugs projects in the fight against organised crime in Central and Eastern Europe and is a member In recent years, the use, production and traffic of the Bucharest Centre in Romania of drugs have been spreading rapidly in Alba- nia The increase is explained by various social, The Centre comprises 11 countries, which in political and economic factors These factors include: lack of preparedness of society to tackle During 1999, Albanian police eliminated 37-armed drugs, free movement across the borders, pov- gangs that operated countrywide These gangs first erty, the desire to get rich quick and the state's emerged during the turmoil of 1997 Some of the gang inability to enforce the law The problem has leaders are currently under investigation or on trial, been exacerbated by the fact that 65% of the while others have been wiped out by their rivals or have population is under 30 years old left the country Statistics show that teenagers and people in their Due to the lack of strict controls, Albania has become a twenties are the most likely to take drugs But, unemployed people are also at risk Young drug shelter for many foreign criminals The General Prosecutor's abusers are more likely to be unemployed than Office has strong suspicions that during 1999 in Albania non-users there were approximately 300 "wanted" persons from other countries pursued by Interpol for grave crimes, terro- The anti-drug police structure is not equipped to rism or association with the Mafia Two foreign citizens, face this situation They lack experience, profes- one from Syria and another from Iran, were alleged to sional qualifications, logistical bases and funds to have committed terrorist acts and were declared per- control the clandestine traffic through customs, sona non grata by Albania along with 16 members of ports and airports The use of drugs and the victi- their families Another foreign citizen, born in Pakistan misation of the young generation are related to and resident of Jordan had to leave Albania because the current social situation They are also related he was suspected of having contacts with the notorious to the lack of social and cultural interests of young people and the failure of society to meet their Islamic terrorist Osama Bin Laden The General Prose- needs cutor's Office issued a warrant for a wanted person from Austria accused of fraud Drug users

Special Albanian police arrested in Tirana a person According to periodic surveys, the number of wanted by Interpol, who was living in Durrës together young drug users for every 1,000 youth has with five family members He was extradited for alleg- edly being the head of the "Muola" clan of the Puglia Mafia, "Sacra Corona Unita"

32 HUMAN DEVELOPMENT REPORT of drug users come from families of average doubled every two years The most common economic level, 25% from rich families and 8% drugs are marijuana and other cannabis sativa from poor families It appears that youth from products, as well as cocaine and heroine wealthier families are three or four times more likely to take drugs than those from poorer fami- Fig 15 Number of drug users lies per 1,000 inhabitants Tab 14 What drives the need for drugs? 55 Cause Cases (%) A family misfortune or family conflict 92 39 Personal drama, lack of money and no hope for the future, physical abuse, solitude, 22 depression, need for love, stress etc 268 Curiosity or the need to imitate 462 Other reasons 178

Tab 15 First contact with drugs Source: Institute of Social and Political Studies Factor Cases(%) Individual contacts with drug users 527 In the majority of cases, Albanian drug users Going to discos 328 take drugs that are impure Analysis of cocaine Celebration of birthdays, excursions, and heroine seized in Albania shows that as many group walks 81 as nine additional elements might be added rang- Others 64 ing from aspirin to ground sand While drug Source: Institute of Social and Political Studies users are generally young, pharmaceutical drug Source: Institute of Social and Political Studies abusers tend to be older In most cases people first experimented with drugs in a group Over half of those inter- Fig 16 Use of drugs viewed said that it was this contact with other users that got them started

Marijuana and other cocaine forms of Cannabis 19% Surveys show that the ratio of male drug users Sativa 65% to female is at least 4:1 The reason behind the greater drug abuse by men lies in their social behaviour They spend more time in-groups,

Heroine clubs and discos, are subject to less family con- 7% other drugs trol and may be more impressionable However, 9% female drug users are more influential in introducing new users to drugs Source: Institute of Social and Political Studies According to a 1999 survey on drug use in Al- There is also an abusive use of psychotropic bania, curiosity and the desire to imitate are the drugs, which are either sold under the counter main reasons for drug use or stolen There are incidences of these drugs being used by people to commit suicide Drug production and trafficking Approximately 70% of drug users come from Current data shows that cultivation of cannabis "normal families" The remaining have one par- sativa is mainly concentrated in the south of ent or none at all, divorced parents or parents Albania, but over the last two years cultivation with social or behavioural problems has started in northern areas of the country as well Drug processing facilities also exist in Al- Analyses of the educational level of drug users bania - three laboratories were discovered in parents show that almost one-third of them are the districts of Fier and Vlora, which pressed university graduates, approximately 52% have and packaged drugs using sophisticated equip- completed high school whereas 13% haven't ment completed middle school Sixty seven per cent

ALBANIA: 2000 33 Albanians are involved in several types of drug bania, social life is characterised by an extreme trafficking First and foremost, is the cultivation individualism compared to the collectivism that and production of cannabis sativa, which goes existed under communist times If individual- to Italy ism is a danger in this regard, then the antidote is to improve social solidarity and community Albanians are also involved in the trafficking to involvement To this end, a number of initia- Italy of cocaine from the United States and hero- tives and projects have been established aiming ine from Turkey, the Southern Republics of the to assist schools to become community centres former Soviet Union, Afghanistan, South East and to help promote cultural and sporting ac- Asia and other countries Another line, which tivities for young people has been flourishing over the last few years, is the traffic of drugs from the USA, and Peru, There is a need to establish a National Drug via Albania for onward transit to other coun- Centre in Albania, aiming to co-ordinate infor- tries Often, this kind of traffic is associated with mation and research This would help correct the distribution of drugs by Albanian residents the tide of misinformation and inaccurate data in Western countries, as well as with the distri- that is misleading the public It could also be- bution for domestic consumption of local drugs come the focus of a national anti-drugs strat- (cannabis sativa) Narcotic plants cultivated by egy for government, NGO-s and the media Albanian villagers have become a major source of revenue for the export market, in particular Although the number of drug addicts has in- to Italy and Greece The market is well con- creased significantly, Albania is one of the very trolled by Albanian trafficking gangs who have few countries without a therapy centre for the the necessary structures rehabilitation of addicts There is also a need to develop and finance drugs awareness Drug use is not simply related to the nature of programmes in schools and universities Students the individual who uses it, but also to society in must learn more about drugs Within the cur- general The less integrated the society, the riculum, anti-drugs groups involving the par- higher the incidence of drug use Today, in Al- ticipation of students, teachers and parents, should be established Albania - being at a geographical crossroad for drug trafficking - soon attracted the attention of foreign criminal organisations According to official data, in Switzerland there are approximately 1000 Albanians in prison for drug trafficking In Italy and Greece, there are 300 juveniles from Vlora City alone in prison for the same offence

The World Customs Organisation considers Albania to be a very dangerous country as regards the supply of hashish and heroine to the trafficking networks in Western Europe

According to the World Customs Organisation, Albania and Morocco are the two main suppliers of cannabis sativa to Western Europe Of 60 tons of hashish seized in 1999 in Western Europe, 65 tons came from Albania and were transported via Italy

During 1999, 104 kg of heroine from Albania was seized in Western Europe, compared to 48 kg in 1998 The police recently discovered some cases of cocaine on a New York - Albania flight There are strong suspicions that four or five Albanian families have developed close relations with Colombian drug dealers in order to transport large amounts of cocaine from New York to Albania The cocaine would be sent to Europe via speedboats over the Otranto channel and trucks through the Balkans

The "geography" of drug production and distribution requires a more concerted effort from the anti-drug police on a nation-wide scale But above all the police need to look within their own ranks to weed out those officers who are actively involved in the narcotics trade

34 HUMAN DEVELOPMENT REPORT Chapter III EMIGRATION

31 Massive emigration Emigration periodperiods

Historical overview Although it is difficult to define exact periods of emigration in the first half of the 20th century, historical and po- Emigration is a phenomenon that has occurred litical factors suggest the following four: throughout Albania's history One needs only to recall the massive emigration of Albanians First period (1912-1923) Albania became a battleground to Italy, in particular from the towns, during the during the First World War The destruction of the agricul- 15-18th centuries as a result of the Ottoman occu- tural economy, lack of industry and the lack of exploitation of pation of the country natural resources, led to the emigration of entire families Between 1921-1923, about 21,000 people left the Towards the end of the 19th century, Albanians country were emigrating much further afield to North Africa, USA, South America and Australia Second period (1923-1939) During the period 1923-1930, These routes became increasingly important in Second period (1923-1939) the first half of the 20th century approximately 33,000 people left the country due to political insecurity and economic backwardness While, dur- According to "Kombi" (The Nation) newspa- ing the years 1930-1939, seventy eight thousand people, per, in 1907 there were 500 Albanians living in including many families left mainly for economic reasons Biddeford (USA) and another 100 Albanians expected to arrive soon In the same year, there Third period (1940-1945) World War II During this period were about 10,000 Albanians living in Bucharest, the number of emigrants reached about 19,000 Many of these half of them running restaurants and in Istanbul emigrants were political opponents of the communist regime there were 20,000 Albanians Emigration was already reaching alarming levels and an official Fourth period (1945-1990) A period when the State pur- report in 1929 stated that the "emigration of sued a policy of social and economic isolation Emigration Albanian workers is becoming a serious threat to the national economy and endangering the was forbidden and the families of those who emigrated ille- interests of our people" A 1935 government gally suffered dire consequences report stated that "the majority of Albanians who live abroad belong to the working class" Prefecture states that "Until today there is no In total, from 1923 to 1944, approximately sign of progress Work continues with the old 150,000 people, or 13% of the entire popula- and outdated means" However, at key motion in 1945, emigrated During the first half of ments in the countrys history, such as during the 20th century, emigration affected mainly the the June 1924 armed uprising, the 1935 Fier south of the country, particularly the coastal re- uprising, World War II and the arrival of the gion and some of the main cities such as Gjiro- communist dictatorship, political insecurity be- kastra, Korça, Kolonja, Skrapari, Vlora, Durrës, came the driving force behind emigration Përmet and Pogradec Mountainous areas were particularly affected Emigration after the collapse of communism The economic and social backwardness of the country was the main cause of emigration A Albanian emigration in the first half of the 20th century is a 1926 report on agriculture from the Durrës phenomenon that had an impact on almost all walks of Albanian

ALBANIA: 2000 35 life6 Emigration played a very important role in reducing unem- ing the second mass exodus to Italy in March 1991 ployment and helping to alleviate the country's difficult economic situation6 Emigrants sent back remittances and material This second exodus found the Italian authori- goods, which increased the well-being of families remaining in ties and institutions unprepared Italian laws and Albania, and contributed to the improvement of communal fa- institutions were not designed to receive and cilities such as roads, religious buildings and water provision6 host such a huge flow of emigrants in such a short space of time Faced with this emergency Emigration also helped to increase levels of education and situation, the Italian authorities asked for the co- vocational training6 According to the data on the general reg- operation of their Albanian counterparts to stop istration of the population in September 1945, 39% of the in- the exodus habitants of the ex- prefectures of Gjirokastra and Korça (two of the regions most affected by emigration) knew how to read Since March 1991, the Italian press and mass and write6 This was a high percentage at the time6 In regions media have helped persuade public opinion that little affected by emigration, such as Dibër, only 10 % of the Albanians are invading Italy Suddenly, within a population knew how to read and write6 few years, Albania had been transformed from a brave little country that had thrown off the Emigration had a substantial impact on social and family life6 It shackles of communism into a troublesome affected everything from dress, home decoration and eating country that bred insecurity and crime habits, to gender attitudes and personal health care6 New attitudes towards doctors developed and health infrastructures Massive emigration - an escape and pharmacies were established6 Returning Albanian emi- from isolation grants took the knowledge of community based initiatives they had acquired abroad and used it to shape new culture, sports Albania's economic situation at the end of the and theatre societies in Albania6 They also set up professional 1980s and the beginning of the 1990s was des- societies to protect workers' rights6 perate and this was certainly a major reason behind mass emigration But there were also other But emigration also led to the loss of the most able work force6 reasons: the very high percentage of young people Most of those who left were young males and this led to the fe- (in 1989, approximately 195 % of the popula- male population in Albania out-numbering males6 According to a tion was 15-24 years old), rapidly declining em- 1945 census, in some villages of Gjirokastra, females of a ployment and the influence of Italian radio and marrying age outnumbered men by 3:1; in Përmet the ratio television programmes During the previous was 2:16 Consequently, there was a substantial gender dispro- decade, many Albanians watched Italian TV and portion in the population, with females representing 51% to the images it presented were very attractive 63% of the total population6 All this was taking place against the backdrop In the summer of 1990, in anticipation of of rapid and radical political change that had radical political change, the international press already begun in Central and Eastern Europe suddenly focused on Albania, as thousands of at the end of the 1980s Events elsewhere pro- people stormed foreign embassies in an attempt vided a catalyst for change in Albania and helped to leave to put in motion the organisational skills and energy of those who had been waiting for the After negotiations between Albanian authori- right time to act ties and international community representatives, approximately 25,000 Albanians were al- After almost ten years of emigration, Albanians lowed to go to Italy, Germany, France and other have a more realistic image of Europe - it is no countries This was the first wave of emigration longer as attractive and alluring as it first seemed and Albania, a long forgotten neighbour, was This new image, more realistic and less appeal- suddenly and sensationally back on the Euro- ing is, in large part, due to the reception some pean and international agenda countries have given to immigrants

The bureaucratic failure of the host countries to Where to emigrate? help the first influx of emigrants were among the factors that fuelled the start of negative stereo- Between 1990-1999, Albanians have emigrated typing of Albanian emigrants It got worse dur- by all means, legally and illegally Legal emigra-

36 HUMAN DEVELOPMENT REPORT tion is mainly to the USA through the Green ers use commercial ships or ferryboats that Card lottery and to Canada Emigration to these travel between Albania, Italy and Greece two countries has grown increasingly in the last From there, emigrants aim to leave for other few years Illegal emigration, which is more com- countries in Western Europe, as well as to mon, takes place in the following ways: the USA and Canada Airlines are also used mainly to Western destinations This route is Remaining in a country after the expiry of a much more costly and affordable only for tourist or business visa This method is the wealthy emigrants usual way of staying in Greece Greek con- sulates in Albania (Tirana, Korça, Gjiro- Claiming Kosovar identity was another im- kastra) all issue visas The same method also portant form of clandestine emigration from applies to Italy The Italian Consulate in Albania, especially during 1999 when West- Tirana issues a high number of visas per day ern countries started taking in Kosovo refu- According to data from the Directorate of gees Albanian citizens forged documents Migration at the Ministry of Labour and claiming Kosovar identity and emigrated as Social Affairs, in 1999 there were 65,000 en- refugees although the authorities have no data try applications and 35,000 visas were issued as to the exact number who left in this way In 1999, both Italy and Greece introduced legal measures to facilitate the conversion of tourist visas to long term residence permits The channel of tears Such measures include advancing the pro- Thirty-seven people, mostly Albanians, who planned to cess of legalisation in Greece and the imple- cross the Otranto channel and celebrate the New Year mentation of a decree by the Government 2000 in Italy, never made it to the other side Their of Italy on the legalisation of emigrants, as speedboat, which had left Vlora on the night of Decem- well as allowing for the possibility to change ber 30, 1999, sank The number of people drowned or a study, business, or tourist visa into a work- lost in the Otranto channel in 1999 totalled more than ing permit 340 Illegal crossing of state borders This is the most common way for low income citizens, After 1992, the clandestine traffic of humans, which was who come from remote areas and can not already an alarming phenomenon, saw a steady increase get a visa According to studies on the mi- The war in Yugoslavia closed the normal transit routes to gration of Albanians, it is estimated that dur- Trieste and the traffic transferred south, to Albania The ing 1991-1999, approximately 5,000 Alba- situation was exacerbated by a lack of tough legislation nians a month went to Greece either with a and strong policing in the southern city of Vlora The grave visa or as clandestines The average number economic situation and lack of employment compounded of emigrants to Italy, both legal and illegal, is the problem in some coastal cities of Albania approximately 1,500 per month The clandestine traffic was of particular concern in the Illegal border crossing on speed boats is the summer of 1995, when Italy's accession to the Sche- method favoured by those who can afford ngen treaty was conditional on stopping the illegal en- the relatively high fees involved Departure try of emigrants into southern Italy through Albania The takes place from the coast and port cities Government of Italy asked the Government of Albania (Vlora, Durrës, and Shëngjin) with the desti- to take measures to stop the traffic In June 1995, the nation mainly to Italy and to a lesser extent Government of Albania decided to seize all speedboats Greece (from Saranda) The existence of this traffic served for a long time to alleviate po- regardless of their purpose One hundred and twelve tential conflicts and pressures which could were confiscated, although they were taken back by result from the marginalization and stagna- their owners during the anarchy of 1997 During the tion of coastal cities and areas same year, press reports stated that 7,000 families in the city of Vlora lived from the profits of the clandestine Illegal border crossing by taxi, ship or air traffic and that their annual profit was estimated to be Albania has a network of taxi drivers that in the region of USD 250-300 million Albania had be- take illegal emigrants, usually to Greece Oth- come an important transit point for illegal traffic

ALBANIA: 2000 37 situation and the lack of a rapid recovery (given Since March 1997 there have been tentative efforts to limited domestic resources), continues to en- stamp out the traffic in the Otranto channel, but they courage people to leave have never yielded satisfactory results In March 1997, the Government of Albania gave Italy the right to patrol When Albanians compare the current overall and prevent the movement of speedboats in Albanian social and political situation with the commu- territorial waters in the hope that they would be stopped nist past, they immediately recognise that they more easily in the narrow passage between Karaburun are better off But in terms of the household eco- and Sazan While trying to stop a ship full of Albanian nomy and personal income, they are more scep- tical They face the difficulties and deprivations emigrants at the end of March 1997, an Italian military of daily life, an unstable political/economic situ- ship wilfully hit the Albanian vessel "I katërti i Radës" ation and a lack of vision for the future One hundred and two people, including many children, lost their lives in this incident This has been the great- Why do Albanians emigrate? est tragedy so far Data from a survey of Albanian emigrants In 1998, the Guardia di Finanza based itself in Durrës and in Greece and Italy speak of the follow- Vlora but with no significant results During the same year, ing six main motives for emigration: Albania and Italy signed a repatriation agreement, which higher wages (29% of the respondents), provided for the payment of repatriation expenses of to help their families left in Albania (284 Albanian emigrants caught by the Italian coastguard %), better working conditions (164%), But this tough legislation, approved by the Parliament in December 1998 has made little difference better living standards (172%), better educational possibilities for themselves The clandestine traffic intensified during the war in Kosovo or their family members (6%) and politi- in the first half of 1999 Not since 1995 have the figures been cal reasons (3%) so high While we know of the 340 that drowned, there are no estimates as to the number who have successfully crossed All stratas of society in Albania have experienced deep economic and social change Until the channel But during 1999, the Guardia di Finanza the middle of 1996 there was a gradual im- sent back about 390 speedboats with approximately provement in the economic situation of Alba- 17,500 clandestine passengers It is estimated that for nian households owing mainly to remittances every two speedboats seized, another eight manage to and the flourishing pyramid schemes These fac- get through tors undeniably lessened, albeit temporarily, the major economic and social problems, which It seems unlikely that the clandestine traffic will stop while emerge as a result of high unemployment rates the police effort is so weak and political elements are in- and big disparities in wealth volved in this criminal activity Choice of country for emigration A backward economy - the main factor behind emigration Research among emigrants reveals that the choice of country of emigration is governed Emigration of Albanians results from factors by a range of factors that push people from their homeland as opposed to factors that attract them to recipient Geographical proximity is the prevailing crite- countries After nearly a decade of emigration, rion, for the following reasons: these dinamics have not changed The strengthening of push factors has coincided with a weak- The prospect of going far away (an early fea- ening of the pull factors, as a result of unsuc- ture of Albanian emigration) is less attrac- cessful experiences and increased difficulties for tive because of the difficulties of travel and those contemplating life abroad communications People prefer proximity

Economic factors are the most important rea- Culture, especially similarity of language and son behind emigration The country's economic way of thinking This aspect has had a sub-

38 HUMAN DEVELOPMENT REPORT stantial influence if we consider the huge exo- According to data from the Albanian Ministry dus to neighbouring countries like Greece of Labour and Social Affairs, during the last and Italy ten years, Albanians have emigrated to about twenty European countries, the USA, Canada Short-term or temporary migration Many and Australia Most of these emigrants have people think they might come back settled in the following countries:

Culture is a very important factor for emigrants Tab 17 Main settlements of Albanian emigrants While economic reasons may be their primary consideration, the cultural needs of the younger Countries Number generation are very important Emigrants think Belgium 2 500 of schooling for their children and the possi- France 2 000 bilities of their integration in the new country Germany 12 000 Ease of movement is also a strong determin- Greece 500 000 ing factor This means not only the ease by which Italy 200 000 emigrants can enter the new country, but also Turkey 2 000 travel to and from their new home and Alba- Canada 5 000 nia USA 12 000 Other factors such as the presence of relatives Source: Ministry of Labour and Social Affairs, 1999 in the host country, the possibility of employment, perhaps in their own profession, and The situation of emigrants higher wages are motives of less importance The degree of integration of Albanian emigrants Re-emigration is becoming more common with in Greece and Italy, the main host countries, is neighbouring countries perceived as stopover more or less the same and the problems they points for re-emigration to other West Euro- experience with the local population, institutions pean countries This is regardless of the im- and social services are also similar provement of working and living conditions in the country used as a stopover The ratio of clandestine emigrants to legal emigrants is beginning to even out given the ex- According to surveys in 1992, 1995 and 1999, pected effects of the legalisation of immigrants the respondents indicated the following countries in Greece and the establishment of legal and in- as their preferred destination for emigration: stitutional instruments as well as a new law on foreigners which acknowledges Greece as a country of immigration Tab 16 Preferred countries for emigration

Order 1992 1995 1999 1 Italy USA USA 2 Germany Italy Canada 3 USA Germany Italy 4 Switzerland Australia Great Britain 5 Australia Switzerland Germany 6 France France France 7 Greece Great Britain Switzerland 8 Great Britain Greece Greece 9 Canada Scandinavian countries Scandinavian Countries and Netherlands and Netherlands 10 Scandinavian countries Other countries Other countries

Source: Centre for Sociological, Political and Communication Research

ALBANIA: 2000 39 During the last few years the role of emigration as an impor- Male Albanian emigrants in Greece and Italy mainly tant factor in the alleviation of the economic and social prob- engage in construction or agriculture, whereas lems of Albanian society is declining There have been many women are employed in domestic services The fact that so many Albanian emigrants are em- reasons for this, most of which are related to the ever-in- ployed in difficult manual labour has reduced creasing difficulties that emigrants face: their chances of improving their professional qualifications and familiarising themselves with Restriction of opportunities and possibilities offered by modern skills and technologies Employment Greece and Italy, the main host countries Both coun- in poorly paid sectors is a way of survival - it is tries, at different levels, are undergoing deep, finan- not a means of integration, or emancipation cial and institutional reform as part of their goal to The process of integration in host countries achieve higher standards of integration within the Eu- becomes difficult due to the following factors: a ropean Union difficult labour market, extremist political and religious attitudes and negative stereotyping by Intensive campaigns against emigrants resulting in the press and mass media which has turned the stigmatisation, discrimination and the demonisation of presence of Albanian emigrants into a political Albanians An element behind this is the involvement of issue The negative factors have been compounded by a number of criminal acts committed some Albanian emigrants in illegal and trafficking activi- by Albanians, which have been widely publicised ties in neighbouring countries Such a climate of intoler- by the mass media ance and racism surfaces in both, Italy and Greece, despite the differing number of emigrants The serious acci- Emigration represents a means of guarantee- dent of March 1997 in the Otranto channel came just one ing survival for families in Albania The finan- day after an Italian politician said that everything should cial support from remittances has been and still be done to prevent clandestine Albanians from coming is one of the main sources of revenue for Al- banian families who have poor economic pros- to Italy, even if it meant throwing them into the sea pects Emigration is perceived as a way to make a living rather than as a means of personal and A good proportion of emigrant remittances ended up in professional development the labyrinthine pyramid schemes that collapsed in 1997 It seems very unlikely that they will ever be returned Albanian emigrants have almost no social or community life in host countries This is due to a During the last decade there has been a gradual ageing number of reasons including the marginal and poor nature of employment, the high number of the first generation of emigrants, while the second of illegal immigrants, the involvement of some generation is not yet properly integrated in the economic, emigrants in the black market and other illegal social and cultural life of the host country The second activities and the lack of priority given by host generation remains by and large passive as it mainly governments to emigrants integration comprises young people, who rely on on their parents to provide finances for their livelihood and education The balance of legal/illegal emigrants

Given the above factors, after almost a decade of emigra- By the end of 1997, 50% of emigrants in tion experience, there are no visible signs of emigrants Italy were illegal, while in Greece, only one returning to Albania and there is no significant investment out of every forty was legal Consequently, on their part in Albania attempts to balance these ratios became a major objective of the Albanian govern- The chances of emigrants returning to reconstruct and help ment During 1999, the ratio of legal to illegal emigrants improved noticeably develop their country is further reduced by the fact that many are non-economic emigrants Many, especially in the spring During 1990-1997, most of Albanian emigrants of 1997, were forced to leave in a hurry because of their were illegal By the end of 1997, there were fear of the political turmoil and insecurity in Albania estimated to be 150,000 emigrants in Italy,

40 HUMAN DEVELOPMENT REPORT of which only 82,000 were registered The dis- the 1990s, revealed that 67% had emi- proportion in the number of illegal emigrants grated It is clear that if the economic and was highly more pronounced in Greece, where social situation in the country does not only 10,000 of the approximately 400,000 Al- improve, the Albanian brain drain will con- banian citizens were legal (prior to the publica- tinue as intensively as before tion of the Decree of the Greek President)

During 1998-1999, for the first time in the last Emigrants include highly educated and quali- decade of Albanian emigration, the ratio of le- fied people from all walks of life, who were gal to illegal emigration began to equalize Out formed in Albania's high schools, universities, of approximately 200,000 Albanian emigrants and science and arts institutions Some of them, living in Italy, approximately 130,000 were legal in particular during the 1980s and 1990s, were by the end of 1999 Thirty thousand were educated and trained in the universities of West- legalised during the course of the year Mean- ern Europe or the USA while, of the 360,000 emigrants waiting for a green card in Greece, about 60% are Albanians The difficult economic and social situation, the Consequently, it is expected that in the year 2000, lack of appreciation of academic work and the the number of legal Albanian emigrants enter- poor facilities for scientific work combined with ing Greece will be 220,000 the allure of the outside world which seems to provide a better chance for their children, are According to official data, between 1991 and all strong reasons for specialists to leave Cur- May 1996, Greece sent back to Albania ap- rent legislation in Albania poses no obstacles to proximately 1,5 million illegal emigrants emigration The Greek police through "Fshesa" (Broom) mopping-up operations forced illegal emi- These emigrants are mostly young and male: 51% of them are under 40 years old and ap- grants to return The timing and intensity proximately 67% are males Unlike the mass of these expulsions were often the result emigration discussed earlier, the majority of of internal political developments in highly educated emigrants (67%) have left with Greece or of problems in bilateral relations their families This demonstrates that they plan Sums allocated by the Greek authorities for their departure carefully, have clear goals and tracking down, arresting and evicting ille- aim to create stable, well-integrated lives in the gal Albanian emigrants during the above host country mentioned period, are estimated to be in the vicinity of 35 billion drachmas The majority of these emigrants come from the cities where there are universities and science institutes Eighty three per cent come from Tirana, which has the largest concentration of 32 Brain Drain academic facilities, 7% from Fier and 20% from Elbasan and other cities An important factor Various surveys show that during 1990- influencing these moves, is that these highly 1999, approximately 40% of the professors educated people have been either studying in and research scientists of the universities foreign universities or have attended long-term and science institutions in the country have training courses in science institutions of West- emigrated This exodus is growing and a ern Europe and have therefore established friendships and working relationships with peers 1998 survey shows that even more of the and colleagues in these institutions This is par- highly educated people want to emigrate ticularly the case with emigration to France, Sixty three per cent of the respondents from Austria and Great Britain and to a lesser extent universities and science institutions, to Italy and the USA mainly young people, wished to emigrate for a long time or forever Another survey in 1999, of 300 academics who received PhD-s in the West during the 1980s and

ALBANIA: 2000 41 The "Canada phenomenon" The emigration of the highly educated elite started after the first wave of mass emigration In Albania, there is a growing concern and ongoing de- It began with the implementation of economic reforms, which meant hardship for all the popu- bate about the so-called "Canada phenomenon" This is lation and above all a reduction of real wages not only because so many Albanians have gone to Canada, and declining employment in Albanian science but also because in the last ten years, Canada has almost institutions Until 1994, the bulk of the emigra- become the only option for legal economic migrants, as tion was to Greece, Italy, France and Germany entry into Europe gets more difficult Later on, more emigrants went to the USA and Canada From 1996, the USA became the most The particular concern about the emigration to Canada is popular choice for well educated people seek- ing to emigrate due to its selective nature, which favours emigrants with high levels of education or training, some of whom are Many highly educated people who have gone among the small minority of Albanians that have studied abroad do not work in their area of speciali- abroad sation Data from a 1998 survey reveals that in Greece approximately 74% do not work in their This emigration is organised by the Canadian government, previous area of activity In Italy, this figure drops to 67%, in Austria, 58% and in the USA, 70% which selects on the basis of education, employment quali- This indicator is lower in Germany, approxi- fications (based on the need of the Canadian job market) mately 47%, and in France, only 19% It is rea- and also on the need to maintain a demographic equilibrium sonable to conclude that most of emigrants will between regions eventually forget their skills and knowledges that they have developed Furthermore, applicants are also required to take with them a considerable amount of money, which represents a net After the collapse of communism, thousands of young people, with financial assistance from export of capital that is badly needed in Albania foreign foundations, the EU and scholarships from foreign governments and universities, have The "Canada phenomenon" is now so widespread that it attended university or post-university studies in risks attracting all those who are likely to become leaders Western Europe or the USA This sector of in Albanian society and contribute to stability and devel- Albanian society, which is exposed to Western opment in the country Among the emigrants to Canada methodology and practice especially in the field there are some who started very successful businesses of science, is in a position to revitalise all institutions in Albania and give new impulse to social, in Albania in the last few years economic and political life

The "Canada phenomenon" receives increasing press cover- Some of the highly educated people return af- age and has become a symbol of the massive brain drain ter their studies and others may consider it But Instead of shrinking, the phenomenon grows continuously given the Albanian reality - a prevailing culture Although the exact figures are uncertain, TVSH (Albanian of bureaucracy, indifference and mediocrity in public administration - there is little to encour- public TV) recently reported that, during 1997, 4,500 Al- age them to seek to live here, to participate in banians went to Canada, but that in 1999 this figure had public life and to help solve the very real prob- risen to 12,000 persons The number of Canadian visa lems of the country applicants is very high

The most credible explanation for this massive emigration is 33 The impact of emigration the continuing insecurity and tension in the country, the lack Domestic labour market of confidence in the future and the marginalisation of highly educated people who feel they cannot contribute to a real Emigration has had an important impact in the change in Albania What makes the phenomenon even reduction of unemployment in the country more disconcerting is the indifference of the State and According to official data, during 1998 unem- politicians towards the problem 42 HUMAN DEVELOPMENT REPORT ployment in the country reached 177%, with a proximately 25 times higher than in Yugosla- figure of 191% in the north-eastern areas where via, 51 times higher than in Turkey, 77 times the level of emigration is lower and 134% in higher than in Greece and 40 times higher than the south where mass emigration exists in Italy This trend is partially explained by the low level of GDP in Albania While unemployment reached 38 % in Kurbin, 26% in Shkodra, 245% in Puka, 215% in Kukes, Annual remittances are also higher than Albania's 142% in Korça, 124% in Kolonja, 121% in annual foreign aid In 1994, foreign aid (techni- Gjirokastra, 119% in Tepelena, 75% in Saranda, cal assistance, food and developmental aid, and 51% in Devoll and 46% in Delvina other forms of assistance) amounted to approximately USD 200 million, while remittances to- Given that Albanian emigration is often driven talled approximately USD 370 million by seasonal and temporary employment, this has had an impact on the Albanian labour market Emigration and investments It is estimated that half the overall number of emigrants are seasonally employed In Greece, Remittances have been an important source of this figure rises to 60% Employment is either finance for domestic investment The majority seasonal or temporary - it is estimated that 58% of remittances have gone towards business deve- of employed emigrants have temporary jobs lopment, housing and personal savings in banks The seasonal and temporary nature of employment is also influenced by the periodic cam- Studies conducted on the start-up capital for small and paigns in Greece and Italy to repatriate emigrants medium size private business, show that 39% of the funding comes from family members in Albania or abroad, of which In Greece and Italy, Albanian emigration helps 175% are remittances Whereas finance from government regulate the domestic labour market In Alba- programmes and bank credits account for only 9% nia, in particular in the rural areas, it results in large fluctuations in the size of the labour force World trends have shown that in most cases, which leaves the land untilled and agricultural remittances are spent on consumer and indi- produce uncollected This phenomenon is most vidual goods and assets (household appliances, visible in the border areas close to Greece cars, land purchase, and shops) rather than investment in production This trend is to a cer- Emigrants remittances tain extent present in Albania, where more than a half of the number of private enterprises are Emigrants' remittances represent approxi- trade enterprises mately one fifth of GDP, almost twice as Remittances have also served in alleviating the much as foreign exchange revenues from housing problem Recent surveys show that 60% exports, almost four times the value of di- exports, almost four times the value of di- of new apartments have been constructed with rect investments and approximately 60% remittances They have also aided the recovery more than the revenue generated by in- of the banking sector through increased savings dustrial production Different surveys show that Albanian emigrants Emigrant remittances continue to be an impor- want to invest two thirds of their savings in tant financial resource not just for families, but Albania and a third in the country where they have also for the economic and social stabilisation emigrated The top investment priority is the of the country Rough estimates show that purchase of land and construction of a house in emigrant remittances have grown from USD their hometown Bank savings in the country 107 million in 1991 to approximately USD 500 where they have emigrated, is also a high priority million in 1999 Emigration and education A relative comparison of remittances data for all the Mediterranean countries has shown that Albania's population has a relatively high level Albanian emigrants' remittances are significantly of education In 1989, approximately 93% of higher As a percentage of GDP, they are ap- the population were educated, while for those

ALBANIA: 2000 43 of working age (under 39 years) the figure was Approximately 41% of emigrants knew almost 100% In 1992, the average number of years nothing of the host country, 46% had partial spent at school for those 25 years old and over knowledge and 13% were well acquainted was 62 (for females, this figure was 52 years) Emigrants knowledge of Greece is less com- Education was an important factor in the pro- pared to Italy cess of integration of emigrants in foreign countries Surveys show that the level of unemploy- Multicultural integration or assimilation? ment among emigrants of basic and middle education was approximately 50% higher than those Developed Western countries have been pur- with high school and university education In- suing policies that promote the integration come is also dependent on education The higher of emigrants These policies vary in kind and the level of education, the higher the earnings can be grouped into integration policies But emigration has had a negative impact on of a multicultural character and integration children's education Many children do not go policies of an assimilative nature to school in host countries for a variety of reasons: among the most prevalent are the inability According to the assimilation policy, an to speak the language, temporary residence in emigrant's culture and language will gradu- the country or having to work ally fade leaving only a "symbolic ethnicity" Multicultural integration is the opposite It Generally, those children who do attend schools is based on the principle that different are unable to learn their mother tongue Accor- population groups can demonstrate their ding to different surveys conducted in Greece, identity and strong cultural traditions, 75% of children in the 10-15 year age group which should be respected by the judicial speak well, but not fluent Albanian, whereas the other 25% have forgotten how to read and write and administrative bodies of the country the language The latter category belongs to the where they live This approach helps the group who immediately settled in Greece emigrants keep their traditions, language Approximately 30% of youth between 20 and and culture alive 30 years old have forgotten many words and do not speak Albanian well This is especially so In the case of Albanian emigrants it is diffi- for those in their early twenties cult to determine which of these forms of integration is more prevalent since there Speaking the language of the host country is are no studies to this end and the data can- the most important step towards integration not be generalised But, the efforts that The level of language fluency determines the emigrants make to find employment and pace of successful integration, both economically and socially Surveys show that approxi- housing and to overcome the many diffi- mately 47% of emigrants do not speak the lan- culties in the host country mean that they guage of the host country, 36% speak it partially focus less on keeping their traditions, lan- and just 17% speak it well The situation varies guage and culture There are cases where from one country to the other Fifty seven per people have changed their names and cent of Albanian emigrants did not speak a word even religious beliefs to overcome the of Greek when they first emigrated to Greece great difficulties of integration But in contrast, only 37% of Albanians bound for Italy did not speak Italian The family and emigration

Detailed analysis of the data shows that the The majority of Albanian emigrants have emi- higher the education level, the better the lan- grated without their families According to a guage fluency Among Albanian emigrants in Italy, 1998 survey in Greece and Italy, only 31% of only 9% of emigrants with middle and high the interviewees had emigrated with one or more school education speak Italian, while 60% of members of their family Of these, 47% had university graduates speak the language, because emigrated with one family member, 29% with they are better prepared two family members, and 24% with three or

44 HUMAN DEVELOPMENT REPORT more family members Emigrants who have Both in the country and abroad there are in- gone to Greece with their family members have creasing numbers of marriages between Alba- been accompanied by an average of 197 per- nians and foreigners In Tirana in 1998, there sons and those to Italy, by 164 persons Thirty were 60 cases of marriage with foreigners In seven per cent of those family members are chil- 1999 there were 95 cases, of which 70% in- dren, 28% spouses and 35% other family mem- volved Albanian women In 4% of these mixed bers marriages the age difference between partners was considered normal Of the remainder, the Emigration without the family has increased the age difference between the foreign male and number of divorces In turn, the disintegration the Albanian female varied from ten to thirty of families due to emigration has led to increas- years and between the foreign female and the ing violence and criminality Albanian male, five to twenty years

ALBANIA: 2000 45 Chapter IV MIGRATION

For the last ten years, internal migration has been one of omnipresent in Albanian history Its dimensions, the most dramatic features of the Albanian transition It intensity, direction and motives have been de- has occurred rapidly and has not followed the normal termined by the economic, political and social trends of urbanisation that we see in other countries developments of the country Migration has fuelled Albania's urbanisation For the first time in the history of Albania, families, individuals and social groups that hardly know each-other The stages have moved into urban neighbourhoods together They now Analysis of population growth since 1923, (the share the same public spaces although they have very first general registration of the population), different customs, mentalities and lifestyles shows a clear and continuous movement from rural to urban areas Migration has contributed to increased levels of conflict in urban areas Young people who were closely controlled Tab 18 Annual average population in thousands in rural areas now suddenly enjoy a new freedom in the city They become anonymous and some take advantage Population/Years 1923 1945 1960 1990 1998 of this situation to resort to antisocial behaviour Population total 804 1103 1607 3256 3354 In the cities 128 235 474 1176 1543 Although they may want to, the youth newly arrived from In the villages 676 868 1133 2080 1811 rural areas are in no position to bond or integrate in any Source: INSTAT social group This situation is unlikely to change for some time As a result, there have been incidences of collective Between 1923-1945, the urban population grew by 84%, compared to 28% in village and rural acts of destabilisation or a tendency to apply radical solu- areas This period was characterised by the large- tions - which is not an unusual phenomenon in post-com- tions - which is not an unusual phenomenon in post-com- scale migration of people from remote moun- munist Albania tainous areas to the lowlands and in particular to the coastline This trend is demonstrated by the fact that while the population of the dis- 41 Historical overview tricts of Berat, Durrës, Tirana and Vlora had grown by approximately 60-170 per cent, those Demographic changes in Albania are influenced of Gjirokastra, Korça and Shkodra had grown by three factors: population growth, internal by just 5-30 per cent and the population of the migration and external migration These factors Dibër district declined have brought about a continuous change in the number and structure of the population, its age This period coincided with the emergence of and geographical location inside and outside the capitalism, the first steps towards the develop- country as well as its social, professional, educa- ment of industry, communications, trade and tional and cultural mix services, the first attempts to solve the agrarian problem and the creation of a favourable cli- Migration within the country, from one residen- mate for the introduction of foreign investment tial area to another, is the result of differing eco- These factors encouraged the growth of cities nomic levels and should ultimately lead to equi- which in turn encouraged migration librium between economically stagnant areas with a labour surplus and better off areas that After World War II, the internal movement of can absorb a larger workforce Migration is the population came in three stages:

46 HUMAN DEVELOPMENT REPORT First stage, (1945 - 1960) A large scale move- ban areas and the central belt Between 1990 ment of people from villages to the cities and 1998, the city population grew by 31% and Throughout this period emigration was forbid- for the first time the rural population fell by 13 den by law, whereas internal migration was per- % mitted Fig 17: Changes in the ratio of urban and rural population (in %) The development of industry, construction and transport led to a rapid growth of cities - Tirana, 00 16 Shkodra, Korça, Vlora, Fier, Elbasan, Durrës and 90 21 30 36 80 to the creation of new industrial cities such as 46 Ballsh, Kurbnesh, Cërrik, Memaliaj and Laç 70

Demand for labour in these centres encouraged 60 the migration of whole families from rural ar- 50 eas During this period the city population 40 doubled, while rural areas grew by just 30% In 30 districts such as Gjirokastra, Kolonja, Përmet, urban 20 Saranda and Tepelena there were fewer people than before the war 10 rural 0 1923 1945 1960 1990 1998 Second stage, (1961 to 1990) Urban growth Source: INSTAT stopped as a result of government policy, in direct contrast with the trend in Europe where cities and urban areas were growing rapidly In The direction of migration 1990, the urban population accounted for 36 % per cent of the population, compared to 73% Most migration occurs between the village and in Europe the city The main goal is to escape the misery of life in the villages Villagers and in particular young During this period, the reduction in domestic people cite the following reasons for leaving: investment and foreign aid (mainly from communist countries), made it impossible for the Insufficient land plots to support families state to generate new employment and meet the housing, food and infrastructure needs of the Land disputes and blood feuds urban population The policy of "T'u qepemi maleve dhe kodrave e t'i bëjmë ato pjellore si Loss of houses and work because of resti- dhe fushat"(Let's climb the mountains and hills tution of land to ex-owners and make them as fertile as the plains) created great difficulties for the villages, in particular in Isolation and remoteness of schools and the North-Eastern areas of Albania where land health centres surface and wages per capita reached critically low levels The artificially high populations of Lack of mechanisation, lack of irrigation and villages during this period led to social prob- chemical fertilisers lems, which were more acute in the North-East- ern areas where reproduction rates have always No clear and effective economic policy to been higher The inadequate allocation of land support agricultural production and other resources as well as economic, social and cultural backwardness made migration in- Lack of rural credit banks Although micro evitable when restrictions were lifted credit has been successful, it provides only limited development possibilities Third stage (after 1990) Policies restricting the free movement of citizens were lifted and the The above factors are still a problem and it is country saw substantial changes in its social, likely that migration from rural areas will con- political and economic structure As a result, there tinue, although at a reduced level has been mass migration from villages, in particular from remote mountainous areas to ur- The displacement of the population from

ALBANIA: 2000 47 mountainous areas, in particular from the North- try These transformations began as an antifas- East, to the lowlands and the coastline is par- cist and antilandowner movement vested with ticularly acute The move is influenced by the egalitarian and utopian principles, but soon had difficult geographical and climatic conditions, a growing number of opponents The move- as well as by the extreme poverty of families ment had an impact on all stratas of society, that live in the mountainous areas Special so- and for well known reasons, it was widely sup- cial and economic policies need to be formu- ported by the rural population, as well as the lated and implemented to keep these areas popu- city poor and part of the intelligentsia lated After World War II, villagers came to the cities There is also a clear trend of movement from not only as supporters of a new political move- small urban towns towards big cities This move ment, but also as new players in the economic is most obvious in the industrial towns, that life of the country This migration enabled the were created during the communist years Em- implementation of industrialisation plans - a po- ployment was limited to the local industry and litically and economically forced process when these industrial activities were halted, mass migration began In some of the small indus- The rural population that came and lived trial towns such as Kurbnesh, Memaliaj and in the towns formed the social power base Selenica, there is only a small chance that mining of the communist movement It was pre- activity will recommence and there is a continu- cisely this support that allowed the lead- ous migration away as a result In other small ership to enforce an authoritarian policy towns there is actually a population increase, but of isolation and control, while restricting this is probably due to transient people who plan more and more the political and civil rights to move on to the bigger cities of the individual

The Tirana - Durrës region is growing the most At this time, almost all public administration po- rapidly and could become a metropolis About sitions were filled by officials of rural origin, who one-third of the country's population is con- brought with them a particular mentality, nour- centrated in this area and the trend suggests it ished in a patriarchal environment The new ar- will grow even faster in the future This region rivals did not care about the difficulties and pri- is not only the most developed part of the coun- vations of life in the city because it was such a try in terms of the economy and social ameni- vast improvement compared to village life The ties, but it also has the biggest concentration of loss of individual rights seemed, initially, to be state, educational, cultural and scientific institu- compensated by the increased material, eco- tions Its natural resources and potential for in- nomic and social advantages dustry make it attractive to migrants A priority of the current Government is to study the effect Life in the city was blissful for many of the new- that this population growth will have on the comers They lived in urban houses - a far cry development of the region from the isolated dwellings with poor access to health services, education or culture which they had been used to Before, their families had tilled 42 Sociological aspects the land or been shepherds under open skies in difficult climatic conditions Now, they were Favoured rural settlements working under shelter in well lit buildings

Prior to the political changes of 1990, the high- They started learning and mastering new crafts est rates of migration from villages to the towns and skills and became mechanics, brick layers, took place between 1945 and 1960 Until 1960, textile workers, drivers, electricians and engi- when the communist political and economic neers Their grandfathers had been mill work- transformations were deemed almost complete, ers, woodcutters and carpenters They had aban- Albania saw the abolition of private property, doned, secluded and isolated jobs and family the creation of agricultural co-operatives and lives, for the collective professional life of the the beginning of a rapid process of factories For the first time, men could work in industrialisation in the urban areas of the coun- the same place with women and girls As a re-

48 HUMAN DEVELOPMENT REPORT sult their customs began to relax and grow more particular in Tirana, and of almost permanent liberal - but society was becoming more closed unemployment, family isolation and the painful and isolated as the leadership followed a rigid loss of cultural traditions programme of Stalinist style industrialisation What matters most to this strata of the population is the fact that their children will have escaped the rural mire The social impact of totalitarian society did and isolation once and for all and benefit from city life not affect all Albanians alike As the so- They or future generations will get better education and cialist industrialisation model advanced, in time, may have the same starting point as other city the rural newcomers to the cities were ini- children tially its most ardent supporters because they felt favoured by the policies of the City migration has its own internal laws Eld- state The industrialisation model and ru- erly people, women and girls are left behind, at ral migrants became mutually dependent least in the early stages, to care for the land and - the one requiring the other for its exist- other material property Their main function is ence to maintain and ensure a continuity of the village economy and generate some form of income to guarantee the survival of the rest of Rural or urban unemployed? the family in the cities

Those that arrived in the cities after 1990 came Youth, in the most part male and couples in for different social reasons It was mainly the their 30s and 40s arrive in the city with an im- middle aged (between 35 and 50 years) and the mediate priority to build a home, and often they young who were leaving rural areas in large num- start to build a home with two or three floors ber, either to internally migrate or emigrate Ru- The construction is often illegal - they seize a ral youth can move with greater ease than be- piece of free land or obtain a construction per- fore and are better educated and informed, es- mit of doubtful legality Their aim is to create pecially through the TV media They have a clear living conditions to allow the whole family to image of city life and a fantasy vision of west- join them in the city ern consumer society Spiritually, they have begun to loose their ties to the land and animals The social composition and structure of the and a life as farmers or shepherds A new men- young rural population settling in the cities to- tality has been born They would much rather day is different from that of their predecessors go and work in the city where there is promise who came after World War II While the latter of a steady wage than help out on the farm found employment in Albania's new industrial On the small family farm these youth have to plants, today's newcomers join the city's unem- work but never get a wage, so they consider ployed It is very hard for them to adjust to city themselves as unemployed life and to make a living If they have a job it tends to be in the black market and service- For rural youth, there is a clear choice be- oriented: foreign exchange dealers in the finan- tween unemployment in the village and un- cial informal market, retail junk sellers, minibus employment in the cities It is not difficult drivers, workers on road maintenance, ware- for them to choose between rural and ur- house and school guards, cleaners, and very ban unemployment This is why they set rarely, brick layers out for the cities Albanian society is opening up to the liberal Middle-aged people that migrate from rural ar- capitalist economic model But the rural strata that has eas are motivated by other considerations They moved to the cities finds it difficult to adapt to urban life are less inspired by the chances of employment and feels disadvantaged because these people in their 30s and 40s know that finding a job is very difficult in the cities New comers to the cities have acquired a num- Instead they leave largely because of their chil- ber of individual democratic freedoms but feel dren and the hope that they can have a better deprived of the social advantages that a con- future To attain this goal, they are willing to temporary well-studied policy of urban inte- face the hardships of living in dirty suburbs, in gration could offer them

ALBANIA: 2000 49 to approximately 05 - 1 hectare of agricultural 43 Main causes of migration land If we bear in mind the fact that the land was often divided into isolated plots then we Transition in a liberal society can better understand the difficulties of the farmer to make the best use of the land Fur- The totalitarian society prior to 1990 imple- thermore, while the land belongs to a family - it mented policies that led to an artificial popula- will be sub-divided again when the sons inherit, tion of the country's rural areas Since it was a further decreasing efficiency This is another rea- society that adjusted its relations through the son for the breaking of ties with the land centralising policy of the state, the demographic and economic policies had to follow suit By The fragmentation of land into uneconomic the same token, job allocation and job distribu- plots has been worse in the North-Eastern and tion throughout the country was determined by South-Eastern parts of the country, which are demographic distribution Well populated vil- the least attractive areas economically They are lages were also seen as a strategic factor in the far from the markets, have poor arable lands and context of military configuration and prepared- are short of water This is why there has been ness in the case of war and was part of the massive migration to the cities propaganda and politics of the communist state The inhabitants of small towns have little or no The change in the political and economic situa- relation with their area of previous residence, tion as well as the liberalisation reforms under- mainly the remote areas in the country The ma- taken in the 1990s reversed the trend The vil- jority of industrial enterprises of these towns have lager, who was now free to choose his place of closed down Of all the former state property, residence and work, naturally began to orient people were left with no more than their apart- himself towards the city, considering that set- ments, which were often of poor standard and tling there was a democratic right provided to inadequate for large families Opportunities for him by constitutional principle Consequently, economic activities in those areas are very limited the artificially overpopulated rural areas began to empty as part of the population lost faith in The collapse of the family clan structure the possibility of a bright future in those areas Many non agricultural activities closed down Even in the past, Albanian society has gone since they were no longer viable, while social through periods of economic hardship and so- and cultural institutions gradually disappeared cial crisis But, it has never experienced such in- because the state could no longer support them tense and rapid migration

Weakening of economic ties An important factor that prevented mass mi- in the villages gration in the past, was the stable structure of extended families in rural Albania Life took place Before 1990, for several decades, all land be- in and around these large family groups which longed to agricultural co-operatives rather than had close and very strong organisational and individuals So when transition began, the rural spiritual ties It was very hard to cut free and to family had no property or real estate to speak of lead an independent life as parental authority was and as a result a wide strata of the rural popula- very strong and maintained the cohesion of the tion, and in particular the youth, had no sustain- family group But patriarchal authority has been able ties or relationship with the village or land weakening for a long time and is no longer an impediment to youth who want to move to The implementation of the Law on Land in the the city in search of a better life Education and beginning of the 1990s not only failed to re- vocational training have helped fuel these hopes establish economic ties between the rural family and the land, but in many cases made their The city as an ideal economic situation worse Land plot distribution per family head brought about land frag- Today Albanian society is bombarded by in- mentation and heavily reduced economic effi- tensive TV messages, which are based on city ciency On average rural families were entitled images Even rural life in the West seems as gla-

50 HUMAN DEVELOPMENT REPORT morous as city life to the Albanian villager The A survey conducted in 1998 among the population of some city is an alluring fantasy - conveyed in interest- of the main cities gave the following results: ing, strange and attractive colours, which have immediate appeal to the viewer Anyone living The respondents rated urban waste collection, sewer- in a rural area who is exposed regularly to tele- age, respecting construction rules, lighting of buildings vision would soon conclude that his or her and streets, road conditions and urban transport, and lifestyle was outdated health services as "very bad"

No need for self-defence Housing and living conditions, environment, rural market services, education and the school network, insti- Historical circumstance led to many Albanian tutions for cultural activities and the arts, and air pol- villages and even cities being placed in strategic lution were rated as "bad" positions, high above sea level and protected by the topography in case of possible aggression Water supply and heating system was considered But today, many Albanians have moved to cit- "somewhat ok" ies, lowland and coastal areas in order to have better opportunities to trade and to have con- The only "good" ratings were given to the network of tact with the outside world commercial services and catering

Life in the cities is deteriorating rapidly due to insuffi- 44 Migration impacts cient investment, a shortage of urban studies and projects and the lack of a clear strategy on the part of the state and local administration The social and economic Slowly but steadily, urban centres are losing the consequences of migration traditional features of city life as they become increasingly threatened by a very rough and The massive migration of recent years has been ready urbanisation Although superficially it spontaneous, uncontrolled and unplanned and might look like a natural evolution, in substance has caused many serious economic and social it is followed by structural changes of society problems and the loss of traditional values Social segre- gation, criminality, antisocial behaviour, lack of It is true that displacement of the rural popula- respect for the rules and norms of public co- tion towards the cities is due mainly to economic existence, violation of sanitation conditions, factors and the quest for a better life But the public insecurity and noisy neighbourhoods, are haphazard and rapid settlement of rural fami- not only sporadic phenomena related to transi- lies in Tirana, Durrës and other large conur- tion They are also the result of unchecked and bations has resulted in increased poverty, un- uncontrolled urbanisation employment, the spread of black market labour, housing difficulties, a lack of schools and health On the other hand, the depopulation of the vil- centres, inadequate water and electricity supplies lages has also begun to exercise a negative im- and a further deterioration in infrastructure pact on rural areas Since it is the young and the middle-aged that are leaving, villages already This huge and sometimes overwhelming move- suffer from shortage of an active labour force ment of people has deeply damaged the urban and as a result, the agricultural productivity and and environmental equilibrium Vital elements the processing of agricultural produce are de- of urban life such as sewerage, roads, waste ma- clining Meanwhile, the Albanian market has been nagement, access to open and green spaces, overrun by imported food, and other agricul- transport and building regulations have been se- tural and livestock products riously compromised Over-population of the cities has stretched public services to the point The departure of young couples and in particu- that public health is jeopardised lar young men towards the cities is destroying the social and demographic structures of the rural population Marriages are getting rarer and the birth rate in rural areas is declining Impov-

ALBANIA: 2000 51 erished by the loss of the young, villages now some cases provoke aggression towards the en- have ageing populations Surveys show that vironment that surrounds them Lawlessness those who leave first and hope to adjust the and delinquency are exacerbated by the inad- best to the labour market in the cities are those equacy of state control who have an education and a profession Tensions between homogeneity and social di- There is a need for at least a medium term strat- versity have also grown due to the lack of clear egy that would control and fine-tune the urbanisation strategies Studies conducted to urbanisation process This strategy should in- date have focused more on the nature and size clude measures for the establishment of a land of migration and the living conditions of new- market, mechanisms to merge small land plots comers There have been no studies on how to form bigger areas, the promotion and imple- migration affects urban areas and the impact it mentation of a rural credit scheme, development has on its native population, or studies on the of businesses that connect agriculture to other ability of cities to integrate the new arrivals non-agricultural sectors in the village, and general infrastructure improvements The demands of the new comers could hardly be met by the local government, which was However, the migration of population towards unprepared and at a loss to organise, and man- the cities should not be seen solely in terms of nega- age the current spontaneous and massive urba- tive social phenomena The experience of West- nisation, and its unexpected consequences ern European countries has shown that with the passing of time and growth of management ca- For its part, the media has only described the pacities, society has managed to find an equilib- events without exploring in depth the reasons rium for these developments Urbanisation helps behind them It has tended to focus on the posi- the growth of political democracy and promotes tive aspects while neglecting the drama of aban- the development of uniform living standards doning century old lifestyles, often to be faced and working conditions for all the population by disappointment

Urbanisation in Albania, even though uncon- There is also tension stemming from differences trolled at present, is following a general devel- and priorities New arrivals want to see their opment pattern There is a movement away difficulties addressed immediately While the from the primary sector of the economy, most city's former inhabitants want the new arrivals' notably agriculture, towards the secondary sec- problems to be resolved once and for all, they tor, processing, industry and construction Ulti- want the city's problems, which are just as big mately this leads to the growth of the tertiary and costly, to be addressed first But some of sector, which includes trade, transport, services, these improvements will take a lifetime and can- education and health not happen in the short-term

The tension created by urbanisation It would have been ideal if both parties had shown more patience as they shared a mutual The huge rural population that arrived in the cities desire for change and improvement Because in a short space of time, brought with it different of the great expectations they had placed in de- customs, traditions, mentalities and lifestyles mocracy and urbanisation, these people have from many parts of Albania The social diver- become weary and disappointed They are the sity which resulted from this movement has ones who spread the epidemic of complaints, caused conflict and tension in city areas which were protest, and intolerance because they expect too hitherto relatively homogenous communities much too quickly

Indigenous city residents are often scornful and Unreasonable expectations of change and the dismissive of the new arrivals while some even time needed to achieve it have often resulted in fear the villagers who have moved into their unfair protests against the state and government, neighbourhoods On the other hand the villag- rather than a more general criticism of the demo- ers often feel like strangers and excluded This cratic system that has created the situation in the situation can awaken rebellious instincts and in first place Emotions that prevail over reason

52 HUMAN DEVELOPMENT REPORT do nothing to explain the fact that successful see people develop common values and cul- urbanisation takes a lot of time It also fuels the tures is nothing more and nothing less than indefensible argument that reform, change and an expression of the use of the old yard- democracy in Albania are impossible, that there stick6 Over emphasis on assimilative prac- is no rule of law and that this country is always tices has consequences on the progress of being led by incapable people and governments democracy6 The concept "we want our People need to be reminded that urbanisation is a Tirana" is not a far cry from the appeals, long process For instance, it took London six made in times past for the levelling of val- centuries to reach its current level of urbanisation ues, points of view, cultures and political attitudes6 Old and new yardstick

Using old parameters to assess the current situation has created tension6 Urbanisation is The psychological impact of urbanisation often assessed using yesterday's yardstick and not that of the future6 Migration from rural to urban areas, over population of cities, heavy traffic, pollution of the According to the old yardstick, the right of environment, and the threat of long forgotten the citizen to participate in public life be- diseases, have resulted in the rise of serious psy- gins and ends with participation in elections6 chological problems But, for many of us it is not clear how to use that yardstick to measure participation In Tirana alone, there are fifty thousand vehicles, in public life6 What is less known, is how 85% are motor vehicles and many are driven to involve the newcomers in solving every- by youth Heavy pollution of cities, hundreds day problems6 Political life in a democracy of electronic game parlours, dilapidated bus ser- should not just be about preparing people vices and people who harass, insult and threaten for elections6 The underlying priority of a each other are some of the reasons behind the democracy is first and foremost the par- considerable rise in psychological illness ticipation of citizens in the process of gov- ernance6 The first general symptom is stress City life itself tends to generate stress, but in those cities Different yardsticks are used even when it that have experienced rapid overpopulation in comes to the evaluation of democracy and recent years, the phenomenon is worse This is the democratic process6 Some see democ- a result of increased insecurity about one's life racy as belonging just to them, without con- and property, an anxiety about what tomorrow sidering their own roots, and they find it will bring, the hectic and chaotic movement of difficult to include the newcomers, who they people and vehicles, noise, pollution, lack of deem uncivilised6 water, the sound of weapons being fired and the sudden and repeated power cuts Others, who accept that everyone is to blame to some extent for the problems of society, Psychological studies show that of all the many appreciate the right of the newcomers to factors that encourage aggression, three con- participate in building democracy6 Stuck in tribute the most: disappointment, verbal insults the middle are the newcomers who in many and violent provocation A new comer to the cases participate in the democratic process city, exhausted by the long search for a house with impatience and agressivity6 Some get and a job, faces an unfriendly environment One together in groups and organise mass pro- may well be disappointed and is likely to get tests, which if not physically violent, at angry or depressed and even aggressive least convey verbal violence6 Road rage is a common phenomenon Individu- We have to readjust also our yardstick when als attacked or provoked in the street do not it comes to the notion of plurality6 A democratic always "turn the other cheek", but react violently society can be defined as a union of small towards the aggressors Verbal and physical vio- communities of all kinds6 The impatience to lence is most common in places where people

ALBANIA: 2000 53 congregate to play or be observed by others: Of the eleven administrative units that make up gambling clubs, snooker halls, bars, discos, etc the capital, half of the city population is concentrated in the four most peripheral units But The loss of personal space is also a cause of irri- this does not mean that central Tirana has not tation and concern for individuals and can lead gone through changes because of the uncon- to threatening and aggressive behaviour Alba- trolled settlement of people Changes have also nians are used to restricted living space, but in occurred in the oldest neighbourhoods, where the past this has always been compensated by people have had a possibility of finding lodging lots of space in streets, squares and parks But in existing buildings or in one of the multi-storey now this public space is increasingly occupied buildings that are being constructed on any avail- by heavy traffic, pollution, waste and dumped able free lot construction materials Other highly populated areas are the communes Twenty nine out of thirty people living in Tirana surrounding Tirana They have turned into small are pedestrians But sidewalks, in many cases, towns crammed with houses and villas often have been blocked by kiosks and bars, mud built illegally by newcomers without respecting and potholes, missing manhole covers and by building regulations or existing infrastructure bicycles that cannot use the road because of capacities badly parked vehicles The most popular communes for newcomers The state cannot bear sole responsibility for the are Kamëz and Paskuqan, followed by the low- solution to these problems which have been land districts, Zallher, Preza, Vaqar and Vora created by the arrival of newcomers to the cit- These are the most attractive areas since they ies Civil society organisations must get involved have little difficulty connecting to the capital and in civic education to reduce the tensions of therefore offer greater possibilities for the labour urbanisation Schools are leading the way in this force and for the trade of agriculture and live- But civic education through community involve- stock products ment, which might lead to a happy co-existence, is still at a very early stage The newcomers to Tirana have arrived from many different districts, especially the rural ar- The metropolis eas of Dibër, Mat, Korça, Kukës, Puka and Tropoja, but a good part of them have de- After 1990, Tirana and its surrounding villages scended from the remote mountainous villages experienced a spectacular influx of people In of Tirana itself They are victims of poverty and 1999, 618,000 inhabitants lived in the district of general hardship Tirana The urban population of the district reached 452,000, of which approximately In most cases, the newcomers' families com- 429,000 lived in the capital, representing 27% prise a couple and children But extended fami- of the urban population of Albania lies with two to four couples are also fairly common While in Tirana City, a traditional family An analysis of Tirana's population figures be- is made up of 35 members, the average for tween 1980-1999 reveals that the highest rate newcomers is 5 persons For these newcom- of growth took place in the last four years If ers, it is difficult immediately to do away with this rate continues, Tirana City will double in the patriarchal organisation and some of the size within ten years outdated traditions to which they are accus- Tab 19 Population of Tirana district in thousands tomed The heaviest burden continues to fall 1980 1985 1990 1995 1999 on the woman who faces even more depriva- District population 297,7 329,7 374,5 470,5 618,2 tions in the city than in the country Urban 197,0 219,3 253,1 341,7 452,1 In general, the young and educated have the Rural 100,7 110,4 121,4 128,8 166,1 strongest tendency to migrate to Tirana The Percentage of urban elderly cannot adjust to the unstable labour population 66,1 66,5 67,6 72,6 73,0 market, whereas the educated have more knowl- Source: Annual statistics of Albania and the civil status office of Tirana municipality/ edge of the possible economic and social op-

54 HUMAN DEVELOPMENT REPORT portunities available in Tirana However, there for the ex-politically persecuted is a real threat of unemployment Although not statistically proven, the rate of unemployment The biggest issue for newcomers has always in Tirana is estimated to be substantially higher been finding a piece of land to settle Many of than the country average the displaced have built illegal houses or have bought the land from the legal owner and then Tirana is becoming a metropolis Successive connected electricity and water illegally Almost governments have watched almost indifferently one half of the heads of families are unem- the assault of the villages on the capital, while ployed and are daily on the lookout for any kind the local authorities are financially powerless to of employment that can help them support their improve the situation International institutions families The average income level per family have intervened wisely with pilot projects Non- varies from Lek 10,000 to 30,000/month governmental organisations also seem to be well Those who live on emigrant remittances are aware of the problem facing Tirana and are slightly better off than the rest However, the taking the first steps to address the situation income level is substantially less than the minimum required to live Statistics speak increasingly about the rapid urbanisation of Tirana But, in reality, Tirana While many families have managed through seems to become more and more rural great sacrifice to build a house, the interior of the houses often have no commodities There Satisfied or disappointed? are also many families that live in very bad conditions by the river, constantly threatened by During the last ten years, Tirana's administra- difficult climatic conditions and with no source tive district of Lapraka, has had the most rapid of assistance, apart from the solidarity of the population growth in the region as a result of neighbours migration and a high birth rate By and large families say that their present liv- Overpopulated by families that descended from ing circumstances are an improvement com- different areas of Albania, this neighbourhood pared to their former homes and that since they now has over fifty thousand inhabitants and first arrived in the city, conditions have contin- presents all the problems associated with un- ued to improve However, in most of the cases, controlled growth of the suburbs families say that they would never have moved if the economic situation had been better where For this reason, a statistical survey was carried they lived before out in Lapraka with the participation of 114 families and 578 persons The results of the The newcomers admit to being nostalgic about survey give a good picture of how the new their former way of life, but continue to accept comers settle and the social and psychological that they had no option other than to move to relationships that develop the capital This is further evidence that depopulation of some regions could be avoided More than one half of the newcomers have if more attention were paid to supporting come to Lapraka in the last four years peoples efforts to meet at least minimum required living standards The low construction price of a house and low rents have made Lapraka popular Families do Families rated street pavement, sewerage and not settle all at once As a rule, it is the adult waste water systems, water supply and access to males that settle in first, but this does not have schools as the most important urban services to be the head of the family Those that migrate The new inhabitants of Lapraka complain that are not the poorest families of the village since their children have to walk for 30-60 minutes to migration requires considerable amounts of get to school When asked about their economic money for transport and to illegally buy land and social situation, the respondents generally and construct a house Usually, the migrants stated that they are satisfied or very satisfied with money comes from the sale of animals or the relations with family and neighbours as well as village house, remittances, or sale of vouchers with the neighbourhood, their houses and the

ALBANIA: 2000 55 health situation But they are unhappy or very un- ing roads, replanting and tidying up parks and happy with work, income and pension benefits rehabilitating areas covered in construction All those who are able to work, the elderly in waste particular, are unhappy that they can no longer give as much help to the family In the village, Lapraka is an urban area with a predominance they would have undertaken various agricultural of young people and newcomers, sections of chores, but now they no longer have the satis- society that traditionally have a high birth rate faction of contributing to the family well-be- In general women do not know about family ing This concern becomes more acute when planning methods or the use of contraceptives the family faces hardships Some of the However, once they become aware of the bene- unemployed consider that with a bit of help fits of family planning, some of them express from the state, they could be employed repav- the willingness to adopt these methods

Fig 18 Rate of satisfaction with the economic and social conditions (in %)

pensions and social assistance 9% 91%

wor k 14% 86% satisfied new arrived peopl e 19% 81% and very satisfied househol d 65% 30%

neighbourhood 71% 29% less health situation 78% 22% satisfied and not relationship with neighbor s 92% 8% satisfied

relationship in the family 94% 6%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

respondants to the servey in %

Source: INSTAT

56 HUMAN DEVELOPMENT REPORT Chapter V ALBANIA WITH REFUGEES AND EMIGRANTS

51 The Kosovo crisis and Albania signed an agreement with the West that prom- ised to stop the violence and terror of the In the early days of January 1999, Adem Demaçi, Milosevic regime the then-political representative of the Kosovo Liberation Army (KLA), Rexhep Qosja, Chair- On March 24, NATO began military air strikes man of the New Democratic Movement and against Yugoslavia Albania offered its uncon- Bujar Bukoshi, Prime Minister of the Kosovo ditional support to the Allied troops All ports Government in exile visited the Albanian capi- and airports, as well as the country's military in- tal The return to Albania of the Kosovar Alba- frastructure were put at the disposal of NATO nian leaders after a relatively long absence was The Albanian government and public opinion due to their preparation for talks with the inter- were unified in support of the offensive national community on the future of Kosovo Albania was trying to lend a hand in solving the A couple of hours before the beginning of the "crisis of representation" of the Kosovar leaders air strikes, Tirana airport was closed The air raid shelters were put on high alert The Gov- Major changes had occurred in the Kosovar ernment sent to the northern border its biggest political and military leadership After the emer- military reinforcements since World War II and gence of the KLA, Ibrahim Rugova, the leader the army was placed on high alert Women and of the Kosovar Albanians had lost his monopoly children were evacuated from villages along the over Kosovar politics He had been elected border with Kosovo for fear of possible clashes leader twice, in parallel elections, which were with Serb troops The Government led by not recognised by the international community Pandeli Majko, avoided declaring a state of The emergence and strengthening of the KLA emergency during the conflict reflected the impatience of Kosovar Albanians in the face of Serbian repression, as well as their On March 28, large numbers of Kosovar refu- loss of faith in Rugovas peaceful politics to gees surged across the northern Albanian bor- realise their aspirations to separate from Serbia der The small town of Kukës became a giant refugee settlement Within a week, the number The so-called crisis of representation of the of Kosovar refugees, violently displaced by the Kosovar Albanians was finally resolved after in- Milosevic regimes ethnic cleansing campaign ternational pressure As a result, in February reached around 450,000 - a figure equal to ap- 1999, the Kosovo delegation participated in the proximately 15 % of the population of Alba- Rambouillet Conference, in Paris During these nia The Government of Albania launched an difficult talks, the delegation accepted at the last appeal for help to the international community minute the agreement presented by the Contact which met with an immediate response Many Group, but asked for a three weeks delay before refugee camps were built throughout the coun- its official signature On March 15, 1999, the try Governments and humanitarian organisa- representatives of the Kosovar Albanians signed tions throughout the world sent an extraordi- the Rambouillet Agreement in Paris, while the nary amount of aid Serb delegation failed to show up and refused to sign Thus, de facto, the Kosovar Albanians But it was the solidarity of the local population

ALBANIA: 2000 57 that was decisive in preventing a human catas- became an almost permanent base for Thaçi trophe Two thirds of the refugees took shelter and other KLA representatives in the houses of the local population Despite their poverty, Albanians offered everything they During the Kosovo crisis, Albania became a key had to the Kosovar refugees Concomitantly, the destination for statesmen, heads of international moment marks the first real encounter between organisations, army generals and diplomats The the Albanians of Kosovo and the Albanians of local population and Kosovar refugees warmly Albania, who for most of the 20th Century had received the British Prime Minister, Blair, the lived apart with little mutual contact Italian Prime Minister, D'Alema, the German Chancellor, Schröder, the French Prime Minis- The period of the Kosovo conflict saw a heavy ter, Jospin, the Spanish Prime Minister, Asnar, military presence in Albania A contingent of as well as many other high level officials about eight thousand NATO troops was in- stalled on Albanian territory to support the com- The signing of the Kumanovo Agreement in plex operation of sending humanitarian aid to June marked the end of the NATO air strikes the North of Albania, as well as to help guar- as well as the end of the Kosovo conflict The antee the sovereignty of Albania But NATO Serb police and military troops withdrew from was not the only military presence - the KLA Kosovo This withdrawal was followed by the also had a large contingent based mainly in the NATO take-over and the KLA fighters came North of Albania After an order was issued down from the mountains and entered into the for the general mobilisation of the population main Kosovo cities The population that had by the KLA general command, KLA troops remained in Kosovo together with the return- set up training camps for the new recruits These ing refugees from Albania and Macedonia wel- troops were joined by volunteers who came to comed the NATO soldiers as liberators and the Albania from the USA and parts of Europe KLA fighters as heroes Different sources estimate that there were between 8,000 and 11,000 volunteers The return to Pristine of the Kosovar politicians and the establishment of the UN civil adminis- With all efforts concentrated on the conflict, the tration in Kosovo marked the end of the role internal political life of the country entered into of Tirana in the Kosovo developments Pris- a period of détente But there was a significant tine became the epicentre of Kosovar politics divergence in opinion between Albanian politicians and their Kosovar counterparts On August 15, the Albanian Prime Minister Majko visited Kosovo This was the first visit On April 1, the world media showed pictures of an Albanian Prime Minister to Kosovo since of the Rugova - Milosevic meeting The next the creation of the Albanian State To enable day, April 2, Hashim Thaçi, the KLA political the visit to Pristine, Majko seized the opportu- leader announced the formation of a tempo- nity of a private occasion While he was there, rary Kosovo Government, "based on the agree- he met with Rugova at his home, as well as Thaci ment reached in Rambouillet among LDK, and other leading players in Kosovar politics KLA and LBD" From this moment on, there was a clear division between political group- Albania came out of the Kosovo war with an ings, which led to fierce mutual criticism On improved international image For the first time, the one hand, until the end of the war, there the international community had an opportu- was the socialist Government of Tirana led by nity to see Albania as a partner, not as a prob- Majko, with the KLA and the Temporary Gov- lem Albania signed the Stability Pact with great ernment of Kosovo, led by Thaci, while on the expectations that the Pact would be both a re- other there was the Albanian opposition led by ward for its contribution during the Kosovo ex-President Berisha, with Rugova and Bukoshi's conflict, and a way forward for the future Government in exile Kosovo had two governments throughout the conflict The presence of NATO troops in Kosovo meant a redefinition of the geopolitical and After leaving Pristine and going to Rome, geostrategic equilibrium in South Eastern Rugova refused to visit Albania, while Tirana Europe where Albania has an important role

58 HUMAN DEVELOPMENT REPORT to play Despite the traditional animosity be- of getting acquainted is an important pre- tween the Tirana Government and its political cursor to building future relations between opposition, they share the same view on NATO the two Albanian communities While the presence in the country and there is no problem Kosovar refugees were impressed by the with public opinion or pacifists generosity and hospitality of their "blood brothers", they were shocked by the state The return of the Kosovars, who had taken shel- of the country's infrastructure - roads, elec- ter in Albania, created a vacuum not only in the tricity, water distribution, hospitals, etc empty refugee camps, but also in the political arena of the country After a political "cease- Demographically, Albania in the spring of 1999 fire" forced by the Kosovo crisis, Albanian poli- was in a very unusual situation Europe's poor- tics returned to their usual agenda and internal est country was giving shelter to half a million conflicts The two main political forces in the Kosovar refugees while almost half a million country, the ruling Socialist Party and the oppo- Albanian emigrants were living in Greece and sition Democratic Party, reverted to the usual Italy In other words, for every six citizens of inter-party conflict as well as internal party the Republic of Albania there was one refugee struggles These led to changes in leadership in Albania and one emigrant outside Albania following party congresses that were held al- This demographic situation, which is unlikely most at the same time in October 1999 The 32 to be repeated in any other country, had short year old Prime Minister and Secretary General and long-term impacts on the economy, poli- of the Socialist Party, Pandeli Majko lost the elec- tics, and people's mentalities Albania was faced tion for the Chairmanship of the Socialist Party with a great challenge, which despite all its prob- to the ex-Prime Minister and ex-Chairman of lems, it managed to cope with successfully the Socialists, Fatos Nano Majko resigned and the socialists formed the third cabinet in their With no impediments to prevent further con- three years of government Thirty-one year old tacts (citizens of the Republic of Albania could Ilir Meta headed the new cabinet not get a visa to visit Kosovo before), the ties between families, who had shared the same roof The Democratic Party called an end to its lengthy for almost three months, have remained intact parliamentary boycott and returned to Parlia- ment after a one-year absence But the opposi- The Kosovo crisis was an opportunity for the tion increased its demands to hold early elec- Albanians to show the good aspects of their tions The October congress reconfirmed Berisha country Negatively portrayed, in particular by as Chairman of the Party, but at this point he the media of neighbouring countries, Albanians faced criticism from a group of members of broke through these stereotypes and gained Parliament and high Party officials led by the wide sympathy This has been an important ex-Vice Chairman of the Party, Genc Pollo step for a society that has lived in a general state of crisis and pessimism caused by a long and Despite the internal conflicts, there have been painful transition Faced by an influx equal to no substantial changes in the respective political 15% of its population, Albania demonstrated stance of the major Albanian political parties its human and organisational capacities (with- regarding the question of Kosovo In a nutshell, out underplaying the vital role of the interna- the current Albanian position is one of full sup- tional community, without which the crisis port for a long-term international Protectorate would have not been managed) This is an ex- for Kosovo perience that can be put to good effect in the post-conflict period

52 "Death brought us together" Besides expanding human relations, the Kosovo conflict served to rapidly develop cultural rela- The Kosovo conflict provided an historical tions between Albanians on both sides of the opportunity for the Albanians of Albania to border Kosovar children took up lessons that meet the Albanians of Kosovo As the re- had been suspended in Kosovo, in the impro- nowned writer Ismail Kadare has put it vised schools that were set up in the refugee "Death brought us together This process camps and Albanian schools The Albanian Min-

ALBANIA: 2000 59 istry of Education has come up with an initia- once had aspirations for a common state6 tive for the unification of textbooks and school It was an artificial barrier which in time curricula for both Albania and Kosovo would inevitably be destroyed6 However, the way this happened was particularly dra- The conflict period and its aftermath also crea- matic, as half a million people displaced ted an opportunity for the intensification of rela- from their homes crossed the border be- tions between the cultural and intellectual elite tween March and April 19996 The barrier Many Kosovar refugees, victims of ethnic clean- had shattered to pieces6 sing, included teachers, writers and journalists, who found in Albania and Macedonia the sup- Relations between Tirana and Pristine were port of their colleagues Immediately after the conditioned by three main factors: the pain- end of the conflict, an Albanian book fair was ful and anarchic awakening of Albania from organised in Pristine, a Tirana television began its long isolation, Kosovo threatened by Serb broadcasting in Kosovo and many of the books atrocities and the international factor6 The published in Tirana during the last decade be- international community was unclear as to came available in Kosovar book shops the consequences of the barrier coming down between the two Albanian communi- Part of getting acquainted is understanding the ties and was, as a result, openly opposed differences in mentalities, customs, and lifestyles, to any project that would promote integra- especially since the elite of Tirana and Pristine tion of the Albanians6 have not always shared the same views But while barriers have come down, there are still obstacles Against this background, Tirana-Pristine rela- to overcome and bridges to be built tions were sometimes contrived and perhaps hypocritical6 Albania was the only country that Kosovars resent the criminal elements that have had acknowledged the Republic of Kosovo, moved, and are continuing to move from Al- constituted in September 1991 by the bania to Kosovo While in Albania, the majority Kosovo Assembly6 But while, in recognition of the population who have not been aggressi- of this, Kosovo had opened a represen- vely nationalistic over the last ten years, find it tative's office in Tirana, the government kept difficult to sympathise with or are indifferent an ambivalent stand on Kosovar aspira- to the Kosovar revenge attacks on Serbs De- tions6 Its support was equivocal6 In reality spite that, a new sense of political and national officials used one language for foreign dip- identity is appearing lomats, a different one for the representatives of Kosovo and a third for internal pur- The half a million Albanian emigrants working poses6 The Kosovars, for their part, shifted in Greece, Italy and other European countries back and forth between an idealistic attach- have helped to support the poor Albanian fami- ment to the Albanian State and a disappoint- lies that faced unforeseen expenses during the ment with the stance of Albanian officials three months the refugees were in the country on cardinal issues6 Their financial remittances, which for the last decade have been vital to the Albanian economy, The crisis, the anarchy and the collapse of were suddenly more important than ever state authority in 1997 had an impact on Tirana - Pristine relations6 The Kosovar leader Ibrahim Rugova, during his frequent Tirana-Pristine, no barriers in-between visits to Albania, had contacts only with the ruling party at the time, not the opposition6 The Albania - Kosovo border is one of the Meanwhile, Rugova's opposition in Kosovo anomalies of the 20th Century6 For some as well as in exile had very close contacts time it represented a border for the preser- with the left wing forces in Albania6 When vation of ideological "purity", but in reality war broke out in Kosovo - and the Serbs it was an artificial barrier created to pre- may well have thought they could benefit vent contact between the Albanians of Al- from Albania's internal crisis - Tirana and bania and those of Kosovo6 It alienated Al- North Albania had become bases for Kosovo banians, and made them forget that they Liberation Army operations6

60 HUMAN DEVELOPMENT REPORT the old Diaspora and secondly, and more im- The war in Kosovo and the threat to the Al- portantly, the new emigrants have witnessed a banian population, managed for some time discrimination which has fuelled a greater sense to unite political forces and public opinion of identity and nationalism During the air strikes, in Albania6 The slogan of the time was "one Albanian emigrants in Greece and Italy organised nation - one stand"6 But it did not last long6 pro Kosovo and pro NATO rallies After June 1999 and the rapid return of the refugees, the border remained open6 Even though this had an impact in bringing closer 53 The impact on the economy the people who lived in the border areas, From an economic viewpoint, Albania came out of the Tirana and Pristine were faced with real dif- Kosovo war as neither a winner nor a loser Some ficulties in communications and felt the dis- indicators suggest that while it benefited during the tance that separated them6 war it lost out afterwards In general, during the Kosovo conflict, which lasted about three months, the Albanian There were a number of people, mainly among economy was not a war economy It would be mistaken businessmen, politicians and the cultural elite, to restrict the assessment of the impact of the Kosovo especially the latter, who were not particularly war to those three months, simply because the Albanian enthusiastic about the opening of the bor- economy has suffered for years and continues to suffer der6 Albania had its own internal problems from the impact of conflicts and insecurity in the region and so did Kosovo6 There were few things to These long term effects have accompanied and some- exchange6 Even the most fervent support- times perpetuated the ers of unification became more realistic and difficulties and problems of economic reform during the began to see it as a process, which would last ten years Failure to find a solution to many of the only come about after Albania and Kosovo economic problems in Albania has been closely related had both recovered from resolving their re- to the troublesome situation in the region spective problems6 A report published by the Bank of Albania im- Tirana and Pristine share the fear that anarchy mediately after the end of the conflict says that could spill over from one side to the other, despite the difficulties "the economy is in a bet- and that there is more potential for co-opera- ter shape than before the conflict" According tion among criminal elements than for po- to the Bank of Albania, during the Kosovo cri- litical and economic integration6 There are sis there was a current account surplus of thirty no official channels of communication be- million dollars tween Tirana and Pristine, not only because there is no mandated local government in The flow of half a million refugees, the arrival Kosovo, but also because UNMIK has not of large quantities of humanitarian aid from the permitted Albania to open an information of- West, the presence of a considerable number fice in Kosovo, although many other coun- of NATO military troops, journalists and em- tries have been allowed to do so6 ployees of international organisations helped the Albanian economy reach a level of services al- This is possibly a reflection of the international most four times higher than usual As a result, community's concern - that once control is the exchange rate of the local currency appre- relaxed, Albanians will want to establish a joint ciated, the inflation was minimal and there was state6 a recovery in the services sector and a rise in exports The conflict period demonstrated once again the strong ties that emigrants have with their Apart from some positive signs in the fiscal, mother country and their efforts to preserve monetary, and balance of payments areas, the national identity In addition to the young people Kosovo war had negative impacts on some sec- of the diaspora, Albanian economic emigrants tors of the economy, which will have an obvious of the last decade also registered and joined the long term impact It restrained structural reforms, ranks of the KLA But the number was negli- the privatisation process, and public and private gible This is for two reasons: firstly, the new investment, in particular, foreign investment The Albanian emigrants are under the influence of country's infrastructure was also heavily dam-

ALBANIA: 2000 61 aged The Albanian economy lost revenues from term, it had a detrimental effect in terms of pro- closing down Rinas airport for civilian activities duction growth and employment in the future to make it available to NATO It also lost substantial revenues from a decrease in commer- An overview of the balance of payments for cial activity at Durrës port - these revenues are the period March - May 1999, suggests that the among the countrys most important sources presence of half a million refugees had contra- of income dictory effects Revenue from the export of services rose to USD 88 million According to Bank Apart from restraining investments, the cost of of Albania data, the refugees spent consider- the crisis should also include the freezing of able sums on goods for everyday living as well structural reforms and privatisation operations as rent for accommodation Daily expenditures Other than the immediate consequences, the per person were estimated to have been about state budget did not receive the expected rev- USD 140, which represented a total sum of enues from privatisation Experts believe that about USD 60 million being spent in Albania Albania will lose out in the medium-term since The money was from family savings and re- these delays will have a negative impact on mittances from emigrant relatives achieving future economic targets The money transfers on behalf of international Even more worrying are the consequences for organisations, humanitarian agencies, media and the private sector For years Albania has been military troops present in Albania during the considered a high-risk country for local and, in months of crisis provided another source of particular, foreign investment The war in foreign exchange The international presence in Kosovo further reiterated the risks faced by the country gave a considerable boost to the potential investors Direct Foreign Investments service sector, such as hotels, restaurants, trans- have been declining and the Kosovo war aggra- port and communication vated this situation Investment in infrastructure made by NATO in terms of road and the The Kosovar crisis also had a positive impact building of the Kukës airport did not make up on the foreign trade balance sheet The popu- for the loss of private investment lation increase of almost 15 % in April 1999 brought about a big growth in domestic demand, In handling the crisis, Albania spent approxi- which resulted in a 35% increase in imports mately USD 150 million To this amount, should This increase in demand for food products was be added an approximate USD 10 million re- managed in large part by the international com- duction in customs revenues as a result of fiscal munity and aid imported into Albania in April evasion, which was one of the direct conse- 1999 represented 50% of all imports The large quences of the crisis These expenditures would quantities of aid prevented rapid inflation and a have had dire consequences, had not the inter- shortage of food in the shops Exports grew by national community responded positively to the 7 % as Kosovar refugees returning home took request of the Government of Albania for di- with them a considerable quantity of food and rect budget financing of approximately USD industrial goods 160 million During the crisis, the monetary and fiscal sec- This extra finance to cover the expenditure in- tors were, generally, well managed and the curred, contributed substantially to keeping in- economy did not collapse as so often happens flation down During the crisis and in the pe- in time of crisis The macroeconomic setting riod afterwards, the rate of inflation remained remained the same, and the results stayed within stable and at an acceptable level When the con- projected levels flict finished at the end of June, the budgetary deficit stood at Lek 215 billion, a figure that The Kosovo conflict had almost no impact on was lower than forecast The domestic contribu- industrial activity in the country In general, the tion towards this debt was only Lek 93 billion industrial sector, which was already very weak, But while non-realisation of budgetary expen- continued as before although there was a slight ditures, especially with regards to public invest- growth of 5% Problems with the mining, met- ments, helped to keep down inflation in the short- allurgical and construction material industries

62 HUMAN DEVELOPMENT REPORT were a continuation of previous difficulties and Emergency Management Group was set up to not a direct impact of the Kosovo conflict manage the overall aid process Meanwhile, the construction sector marked a growth of 16 %, which is believed to be the The Emergency Management Group was made result of renewed investment in public works up of six key players with clearly defined tasks: implemented with the assistance of the international community and NATO UNHCR, the co-manager of the Group, took a very professional leading role6 During the 54 Handling the emergency rehabilitation stage, the leading role was passed on to UNDP6 The arrival of massive numbers of Kosovar WFP together with the Ministry of Agricul- refugees created a great logistical chal- ture and Food co-ordinated the management lenge From the beginning of the air strikes of basic food products6 against the Milosevic regime on March 24, WHO jointly with the Ministry of Health co- 1999 until June 9, 1999, a little before the ordinated the process for the prevention of end of the war, the number of refugees diseases and guaranteed health and medi- reached almost 500,000 Within a few days cal assistance6 approximately 320,000 had taken shelter MAPE supported the Ministry of Public Order in the houses of Albanian families, 75,000 to guarantee order and peace in the camps, in the camps built during the emergency security of warehouses and the escort of period and about 85,000 in public build- convoys of materials for the refugees6 ings which were turned into large scale OSCE co-ordinated the collection of all data collective shelters There were major con- on the needs, problems and concerns in the centrations of refugees in Kukës, Tirana field6 and Durrës At the end of the war, within NATO worked with the Ministry of Defence to less than four weeks, 95 % of the Kosovar control logistical supplies and airport traffic refugees in Albania returned home and to increase the efficiency of Durrës port as well as to repair roads6 Management of the emergency Albania received humanitarian aid from four The handling of the emergency in Albania had main sources: four stages: receiving the displaced, accommo- Bilateral humanitarian aid from different dating them, repatriation and finally rehabilita- countries This aid was managed by the Gov- tion of the areas affected by the crisis Apart from ernment through the Office for Refugees at the mechanisms of central and local government, the Ministry of Local Government in co- many organisations were involved in the man- operation with the State Reserve agement of the humanitarian crisis, including Multilateral humanitarian aid through inter- UN agencies such as UNHCR, UNOCHA, WFP, national organisations such as UNHCR, UNICEF, WHO, UNDP, European and re- UNICEF, WFP, etc This aid was managed gional organisations such as OSCE, ECHO, and monitored by the organisations them- NATO/AFOR, MAPE, as well as almost 200 selves foreign and local non-governmental organisations Humanitarian aid through local and foreign NGOs This aid was also managed and The dimensions and dynamics of the humani- monitored by the organisations concerned tarian emergency highlighted the need for co- In addition, it was monitored by the Direc- ordination involving all the key players: the Gov- torate for Humanitarian Aid and NGO Co- ernment of Albania and UNHCR (together with ordination at the Ministry of Labour and all the rest of the UN organisations) to lead the Social Affairs effort, NATO/AFOR to support and facilitate Bilateral humanitarian aid through missions the humanitarian mission and OSCE to monitor from different countries Based on a frame- A special decision of the Council of Ministers work agreement, the latter took upon them- established a Government Commission chaired selves camp construction as well as manage- by the Prime Minister to co-ordinate and super- ment and delivery of all services required vise the distribution of humanitarian aid The for running the camps

ALBANIA: 2000 63 Management of the emergency situation was Kosovar refugee crisis, non-governmental orga- made possible due to the full involvement of nisations managed to mobilise more quickly all the elements of central and local admi- than state bodies and UNHCR nistration The role of the Emergency Manage- ment Group was to co-ordinate and plan Lo- Undoubtedly, Albanian civil society suffers from cal government dealt directly with the problems the fact that it functions in a country where the At the local level (based on Prefectures), the Co- state and its institutions are weak NGOs are ordination Unit was composed of the Prefect sometimes accused of being unnecessarily dis- and other elected leaders from the municipali- trustful of the state, but in Albania, the weak- ties, communes and districts within each pre- ness of the state makes the environment in fecture In Kukës, the Unit was further strength- which they work more difficult and insecure ened with the appointment of the Government's Special Envoy Local government carried a very Albanian NGOs have managed to survive heavy burden throughout the conflict with the thanks to the help and support of foreign do- arrival of refugees, arrangements for their trans- nors This in turn has created a certain depen- portation throughout the country, distribution dency on foreign donors, which is expressed of humanitarian aid, etc Besides handling the by NGOs tendency to present projects accord- refugee crisis, local government ensured that ing to the donor's objectives rather than base normal activities continued as usual them on the immediate demands of the country Central and local government co-operated very well throughout the crisis period This is espe- The Kosovo crisis was a test for Albanian civil cially significant since relations between the cen- society and its relations with the communities in tral socialist-controlled government and the lo- Albania were substantially strengthened The cal democrat controlled government were deli- implementation capacities of civil society organi- cate, if not confrontational sations were enhanced and they established contacts and relations with several Kosovar NGOs Civil society and the Kosovo crisis Foreign donors now have more confidence in Albanian non-governmental organisations The fact that almost 65 % of nearly half a million refugees were received, accommodated and Media: A Fleeting Consensus sheltered in the houses of Albanian families is an extraordinary achievement for a small coun- The national media found the biggest news story try like Albania of 1999 at their doorstep6 The refugee situation in Albania, and NATO air strikes on Yugoslavia The participation of families and communities brought the eyes of the world on the region6 For in handling the emergency situation, although the first time in the post-communist history of not very organised, represented a step forward Albania, the highly politicised media sent a uni- in the consolidation of the emerging Albanian fied message to the Albanian public: We sup- civil society Many local and foreign NGOs got port NATO, we support the refugees6 involved in the management of the crisis Para- doxically, the general public seems more capable When the bombings began, the media covered in times of crisis than in peacetime During the almost exclusively war developments, and crisis of 1997, when the Albanian State collapsed, between March and July the largest Albanian civil society managed to survive and even send newspapers on average dedicated over 30% out messages of hope and revival During the of their pages to coverage of the war6 Some newspapers and private TV stations, despite Beyond the context of the Kosovar crisis, Albanian society extremely meagre budgets, sent correspon- continues to be politicised The organisations of civil so- dents abroad for the first time, to cover the ciety reflect to a large extent the general politici-sation of Rambouillet talks6 The local media made ex- Albanian society and in particular its fragmentation There tensive use of the international medias cov- are two main trends that characterise the Albanian politi- erage of the war, whenever they were not able cal class: one views NGOs as adversaries, the other con- to cover the events themselves6 CNN, BBC siders them as allies World News, Euronews, Italian news, and

64 HUMAN DEVELOPMENT REPORT other pro-NATO sources accessible via satel- ences, in the refugee camps and on the bor- lite were shown on the State and private tele- der, asking their questions and getting their vision stations, dubbed into Albanian language stories6 Despite limited resources, the local when time permitted6 Editorials and articles media, with ingenuity and promptness, played from the New York Times, the Washington Post, a professional and positive role in the success La Republica, Corriere della Sera, and other for- of Albania's handling of the Kosovo crisis6 eign newspapers were translated, reprinted, and commented upon in the Albanian press6 By the end of 1999 the crisis was but a memory, The locally based Reuters and ANSA news ser- with only a few thousand refugees remaining vices were also widely relied upon by the lo- in Albania6 Although events in Kosovo remai- cal media as sources of information6 ned an important component of the news, the Albanian media by and large returned to cov- The Albanian public was, in terms of the volume erage of internal political quarreling6 of information, kept well informed6 Radio and television stations produced an array of programmes featuring interviews, press confer- 55 New relations with ences, and in-studio debates and discussions the international community on developments6 Aside from direct coverage and analysis of the conflict, the local media was After the political changes of 1991, international also extremely active in directly aiding the refu- co-operation and integration has been a top pri- gee community by disseminating information on ority for Albania The Kosovo crisis allowed the whereabouts of lost family members, Albania to extend its partnership with other UNHCR activities and procedures, and the countries and further integrate into international dangers of landmines6 institutions Never in its modern history was Al- bania so close to the West as during the Kosovo The media was singularly and overwhelmingly in conflict favour of supporting NATO6 The only difference of views among media concerned their posi- Co-operation with NATO tion regarding Ibrahim Rugova and Hashim Thaçi6 The Democratic Party-led opposition Albania became a member of the North Atlan- press tended to support Rugova while the Gov- tic Co-operation Council in 1992 It was also ernment and Socialist Party press demon- the first ex-communist country to ask for full strated close ties with the Kosovo Liberation NATO membership In 1994, Albania signed Army and Thaci6 The opposition press also the Peace Partnership agreement During the criticised international entities and the Gov- Bosnia war, Albania offered Allied Forces its ernment for alleged mishandling of humani- airports and military infrastructure Every year, tarian aid6 Allied troops have held joint military manoeuvres and trained with the Albanian army But, Hundreds of international journalists were present Albania's hope of inclusion within NATO was in Albania throughout the conflict, with most getting more remote because Albania was situ- major news agencies renting offices in the capi- ated in a conflict zone and its army had col- tal, Tirana, as well as Kukës6 A satellite truck lapsed during the crisis in 1997 was located in the parking lot of the Tirana International Hotel, sending out the latest pic- On June 1, 1998, NATO opened the Peace Part- tures of refugees crossing the border, and vis- nership Office in the Ministry of Defence This its of international officials, politicians, and office was entrusted with the co-ordination and celebrities6 The generally young and inexperi- implementation of the Individual Peace Pro- enced Albanian journalists were somewhat taken gramme The opening of this office, the first aback by their aggressive international coun- of its kind, demonstrated increasing interest on terparts who arrived in large numbers with the part of NATO to expand its relations with deep pockets to pay for meals, accommoda- Albania, which was related first of all to the tion, vehicles, and interpreters6 However, the threat of conflict in Kosovo Albanian journalists were fully present and accounted for in NATO and UN press confer- As the Kosovo situation deteriorated, the Gov-

ALBANIA: 2000 65 ernment of Albania repeatedly asked the Allied opened a number of offices in several districts Forces to put their troops on Albanian territory of Albania and to intervene in Kosovo In response to the tense situation, NATO increased technical as- OSCE is in charge of the co-ordination of the sistance to Albania and Macedonia, and contin- "Friends of Albania" group established in Octo- ued with its joint military manoeuvres as a warn- ber 1998 The purpose of this Group is to in- ing to Serbia In June 1998, there were military crease international help and support for Alba- air manoeuvres in Albania and Macedonia, while nia The 'Friends of Albania" is made up of rep- in August, Albania saw the largest military ma- resentatives from 24 countries and eight interna- noeuvre to date between NATO troops and the tional organisations This informal group has Albanian army (Co-operative Assembly 98) been turned into the main forum for the monitoring of economic and political reforms in Al- The air strikes in Yugoslavia marked the close bania affinity between Albania and the Atlantic Alli- ance Without flinching and with the full sup- OSCE plays an important role in the legal field port of public opinion and the opposition, the The Administrative Centre for the Co-ordina- Government of Albania offered the Alliance its tion of Assistance and Public Participation ports, airports and all the military infrastructure (ACCAPP) was established in October 1997 of the country This Centre was responsible for ensuring national and international participation in the draft- Albania felt obliged to do its utmost to show ing of the new Constitution of Albania OSCE its solidarity with the Albanians of Kosovo But monitored the Referendum for the Constitu- the country also felt more secure under the tion of Albania On the basis of this Referen- NATO umbrella in case the conflict should es- dum, in which the opposition did not partici- calate The presence of NATO troops also hel- pate, the country approved the first Constitu- ped maintain the country's own internal stabil- tion of the post-communist period ity, which was threatened by the widespread presence of arms and an unstable political climate By the beginning of 1998, the OSCE mandate was extended to include monitoring of the bor- During the air strikes, 8,000 Allied troops der between Albania and Yugoslavia To this (NATO/AFOR) were based in Albania and end, OSCE opened six temporary offices in played an invaluable role in helping Albania to Bajram Curri, Kukës, Tropojë, Padesh, Krumë cope with the humanitarian crisis and Koplik During the Kosovo conflict, OSCE assisted UNCHR in co-ordinating the After the conflict, a limited contingent of 1,800 national and inter-national efforts for manag- NATO troops remained in Albania Although, ing the refugee crisis Albania is not a NATO member, the large presence of NATO suggests that it co-operates Albania and the Council of Europe closely with the Albanian armed forces Albania became a member of the Council of Co-operation with OSCE Europe in June 1995 After gaining membership Albania approved the European Charter of Albania became an OSCE member in June 1991 Human Rights and suspended capital punish- and OSCE has played a more specific and sub- ment - an action that caused much discussion stantial role in Albania than in any other country of the region The Council of Europe provided technical assistance to Albania for the drafting of the Con- Especially after 1997, OSCE has been playing stitution an important role in monitoring the political developments and elections in Albania, in co- During 1999, Albania signed the Charter of ordinating the international assistance progra- Local Government Autonomy, the Framework mmes, consolidating civil society and in interven- Convention for the Protection of National Mi- ing to help forge a dialogue between the gov- norities, while in the beginning of 2000 it signed ernment and the opposition OSCE has the Protocol 6 of the European Convention

66 HUMAN DEVELOPMENT REPORT on Human Rights for the Abolition of the Death The Diaspora of Albanians in all the neighbouring Penalty countries undoubtedly makes the Albanian factor a very sensitive issue for the Balkans For this United Nations Agencies reason, Albania has an important role to play in the delicate balance of the region The humanitarian agencies of the United Na- tions System, particularly, UNHCR, UNICEF Albania is an active participant in a number of and WFP played a crucial role in the manage- regional initiatives such as the Balkans Leaders ment of the refugee crisis Summit, the Black Sea Initiative, Corridor 8, Southeastern European Co-operative Initiative UNHCR was the lead UN agency responsible (SECI) and the Royaumont Initiative, all of for receiving and accommodating refugees and which aim to expand regional co-operation in also co-ordinating humanitarian aid In this func- different areas In Albania, the most talked- tion, UNHCR was supported by the United about of these initiatives is Corridor 8, also known Nations Office for the Co-ordination of Humani- as the East-West Corridor, which will connect tarian Affairs In co-operation with the Govern- the Port of Durrës to Skopje, Sofia and Istanbul ment of Albania they devised plans for all stages of the refugee crisis such as hosting and accommo- With the exception of Yugoslavia, bilateral co- dation of refugees, organisation of their return operation with countries in the region has con- and rehabilitation of the areas used by refugees tinued to grow

UNICEF was responsible for the co-ordination Albania and Macedonia have made progress in of activities related to the schooling and health their bilateral relations and have signed in a short of children This agency made an important con- period of time fourteen agreements covering tribution in the area of training for psychological different areas The tense situation generated counselling to assist children traumatised by the between the two countries after the Bllaca events, conflict Large groups of psychologists and edu- when thousands of Kosovars were blocked for cation experts were involved in psychological several days in the Macedonian border, soon rehabilitation projects in the refugee camps and passed The relations between Albania and Greece neighbourhoods where refugees were staying have also strengthened and expanded Relations Summer schools where opened and the authori- remained intact and unchanged despite substan- ties were given assistance with the increased work- tial differences of opinion between the two coun- load UNICEF sent groups of doctors and sup- tries on NATO air strikes and on the Kosovo ported the vaccination campaign against differ- issue in general Albanian-Turkish relations have ent diseases It also launched an awareness cam- always been positive An important indicator paign related to the dangers that awaited the refu- of the good relations between Albania and gees when they returned home, in particular the Turkey, is their close military co-operation threat of landmines and unexploded ordnance In April 1999, Belgrade broke off diplomatic WFP co-ordinated all in-country food distribu- relations with Tirana because of the support tion, providing basic rations to the refugees A Albania gave to NATO and the KLA Now, network of distribution warehouses was estab- there are no contacts between the two countries lished close to the refugee camps Shortly after Despite this, Albania has good relations with the peace agreement and the subsequent rapid Montenegro and supports the pro-Western Presi- repatriation of Kosovar refugees, WFP started dent Djukanovic It is a well known fact that to provide food relief to Kosovo as well Albanians who represent almost six per cent of the population of Montenegro have suppor- Albania and its neighbours during ted Djukanovic and opposed his rival Bulatovic the Kosovo conflict

The political, economic and social development 56 Albania and the Stability Pact of Albania has been conditioned to a large extent by the developments in the region In this con- Of all the Balkan countries, Albania was perhaps the text, the Kosovo crisis has had a direct impact most enthusiastic about the Stability Pact There has

ALBANIA: 2000 67 been full Albanian political consensus on the Pact from try in the region The interest applies to the re- the first day of its launch The Stability Pact was gion as a whole The Stability Pact is an effort perceived as the region's key opportunity to rid itself to promote a new regional identity of conflicts and get closer to the rest of Europe But it has been noticed in Albania that regional Given that the reaction to the idea of a Stability co-operation is often reduced to economic af- pact was so enthusiastic, it is reasonable to say fairs The emphasis is placed on commercial that expectations were somewhat unrealistic exchange, connecting infrastructure and eco- Like in other countries, the first step was the nomic co-operation While these are impor- declaration of political commitment to the Sta- tant goals, they are not sufficient Economic bility Pact, but there was no vision of the ob- co-operation alone cannot address problems jectives, strategies and instruments of the Pact of poor political and cultural communication, This process of elaboration of a vision has yet which could hinder regional co-operation in to be completed and will continue in parallel the long term with the implementation of the Pact Economically, Albania is in a state of pro- The Stability Pact was initially conceived as a longed stagnation and much energy has supplementary source of donor finance for the been spent on macroeconomic stability, but region But to compare the Stability Pact with not enough on development The Stability the Marshall Plan showed a lack of understand- Pact is an opportunity to change that ing and a flawed perception of current and past realities The Stability Pact is not a new player, Albania has submitted a number of projects nor a new donor in the region It is a new po- for consideration by the Stability Pact Those litical agreement between countries and donors projects are an attempt to fine-tune the needs in the Balkans of the country with those of the region Projects include rehabilitation of infrastructure (road, The Stability Pact is perceived as an important energy, water and port infrastructure), institu- catalyst to speed up transition and reform, and tional capacity building, good governance, de- to bring the region closer to Europe But in velopment of civil society and independent me- countries where there is a low starting point, dia, disarmament of the population and streng- such as Albania (where the social, economic, and thening of internal and regional security Most political problems are very complicated) the of the projects are multilateral regional schemes process of stabilisation and drawing benefit with the construction of Corridor 8 being the from the Pact will take longer to materialise biggest

Regional co-operation is undoubtedly one of Albania also submitted to the Sarajevo Summit the key objectives of the Stability Pact This co- a number of proposals including the formation operation is of special significance in the cur- of free economic zones in the region, the es- rent political context of the Balkans The em- tablishment of conditions for the free circula- phasis of the foreign policy of the European tion of goods and people, the reform of educa- countries and USA, in supporting regional co- tion and communication systems and the cre- operation, demonstrates these countries unprec- ation of de-militarised border zones edented political commitment to the Balkans While during the 1990s, the political and finan- Albania perceives the Stability Pact as an op- cial assistance of the West focused, for a num- portunity to communicate with all the neigh- ber of reasons, on the post-communist coun- bouring peoples and in this context to promote tries of Central Europe, today there is a great an inter-Albanian communication But, there is political and diplomatic commitment to the apprehension within the international commu- Balkans nity about supporting inter-Albanian projects, especially those that have to do with Albania The interest and the political involvement of and Kosovo This belief that every inter-Alba- the EU and the USA in the Balkans today is not nian project is somehow related to Kosovo and a result of traditional geographical and political a national question has not gone unnoticed by interests in the region or in any particular coun- the Albanian government

68 HUMAN DEVELOPMENT REPORT While the political barriers that impeded com- comes to economic relations with Kosovo in munication between the Albanians of Albania the post-conflict period and the Albanians of Kosovo have been lifted, there are still strong infrastructural barriers The For Albania to maximise its benefit from the roads that connect Albania to Kosovo are in a Stability Pact it would be necessary first, to cre- very bad state and unlike Macedonia, which has ate some type of national Stability Pact, ie an an agreement with Yugoslavia that allows trade internal agreement, which would channel ener- goods passing into Kosovo to be free of double gies away from political conflict towards con- tax, no such agreement exists with Albania sensus and reconstruction of the country

Likewise, the development of economic rela- The political class in Albania must realise that tions with Kosovo via Montenegro which is one the Stability Pact is not an international patron- of natural routes between Albania and Kosovo, age that will solve all the country's problems It is hindered by instability in Montenegro All these should be seen as a way forward to create a factors place Albania at a disadvantage when it new destiny for the country

ALBANIA: 2000 69 ANNEXES : STATISTICAL DATA

Tab. 20 Annual average population (in thousands) Years Total Male Female Urban Rural Density

1923 804 ...... 128 676 28 1950 1215 624 591 249 966 42 1960 1607 828 779 474 1133 56 1970 2136 1097 1039 680 1456 74 1980 2671 1378 1293 897 1774 93 1990 3286 1686 1600 1176 2080 114 1992 3190 1589 1601 1165 2024 111 1993* 3167 1566 1601 1314 1852 110 1994* 3202 1586 1616 1345 1857 111 1995* 3249 1608 1641 1381 1868 113 1996* 3283 1624 1659 1445 1838 114 1997* 3324 1629 1695 1526 1798 115 1998* 3354 1650 1704 1543 1811 117 *)Estimation by INSTAT

Tab.21 Natural movement of population (in figures)

Year Live Births Deaths Natural Increase Marriages Divorce 1950 47291 17215 30076 12341 976 1960 69686 16775 52911 12571 850 1970 69507 19774 49733 14449 1625 1980 70680 16981 53698 21729 2024 1990 82125 18193 63932 28992 2675 1991 77361 17743 59618 24853 2236 1992 75425 18026 57399 26405 2361 1993 67730 17868 49862 25963 2251 1994 72179 18342 53837 27895 2108 1995 72081 18060 54021 26989 2333 1996 68358* 17600** 50758 27690** 1901 1997 59541 18224 41317 24111 1430 1998 60139 18250 41889 27871 2005 *) Ministry of Health **) Operative Data

1 Tab. 21 Life expectancy at birth (in years)

Year Total Male Female 1950-51 53.5 52.6 54.4 1960-61 64.9 63.7 66.0 1980-81 69.5 67.7 72.2 1989-90 72.2 69.3 75.4 1990-95* 71.4 68.5 74.3

*) Estimation by INSTAT

Tab. 23 Population and labor force (in thousands) 1993 1994 1995 1996 1997 1998 1999 Population 3,167 3,202 3,249 3,283 3,324 3378 … Population eligible to work 1,763 1,786 1,820 1,850 1,861 1888 … Labor force 1,364 1,423 1,309 1,274 1301 1320 1313 Participation rate (in %) 77 81 73 69 70 82 82 Employed 1,063 1,161 1,138 1,116 1107 1085 1073 Unemployed registered 301 262 171 158 194 235 240 Unemployment rate (in %) 22 18 13 12 14.9 17.7 18.3

Tab. 24 Employment, as per NACE* classification in thousands in % 1994 1995 1996 1997 1998 1999 1994 1995 1996 1997 1998 1999 Total 1,162 1,138 1,116 1,107 1,085 1,073 100 100 100 100 100 100 Agriculture and Fishing 780 778 777 771 768 770 67.1 68.4 69.6 69.6 70.8 71.8 Extracting Industry 20 21 18 16 16 15 1.8 1.8 1.6 1.4 1.5 1.4 Processing Industry 81 65 62 58 54 55 7.0 5.7 5.6 5.2 5.0 5.1 Electricity, Water 9 9 10 14 14 14 0.8 0.8 0.9 1.3 1.3 1.3 Construction 18 21 22 15 11 12 1.6 1.9 1.9 1.3 1.0 1.1 Trading 32 51 58 47 22 27 2.8 4.5 5.2 4.2 2.0 2.5 Hotels, Restaurants 10 11 20 10 13 12 0.9 1.0 1.8 0.9 1.2 1.1 Transport and 28 30 27 27 33 33 2.4 2.6 2.4 2.4 3.1 3.1 Communication Education 55 53 46 49 49 48 4.7 4.7 4.1 4.4 4.5 4.5 Health 32 26 23 25 27 27 2.8 2.3 2.0 2.3 2.5 2.5 Others 96 73 62 75 78 60 8.3 6.4 5.5 6.7 7.2 5.6 * European classification of economic activities

Tab. 25 Employment in thousands in % 1995 1996 1997 1998 1999 1995 1996 1997 1998 1999 Total Number of 1,138 1,116 1107 1085 1073 100 100 100 100 100 Employees State Sector 276 239 226 213 209 24.2 21.4 20.4 19.6 19.5 Agricultural Private Sector 750 761 761 761 761 65.9 68.2 68.7 70.1 70.9 Non-Agricultural Private 112 116 120 111 103 9.9 10.4 10.9 10.3 9.6 Sector

Tab. 26 Registered unemployment, long term unemployment and unemployment rate 1995 1996 1997 1998 1999 Total Number of Unemployed People in thousands 171 158.2 193.5 235 240 - long term unemployed people in thousands 124.3 120.2 162.6 209 216 - unemployment rate in % 12.9 12.3 14.9 17.7 18.3

Tab. 27 Wages and pensions (in Leks)

1993 1994 1995 1996 1997 1998 1999 Unemployment Salary 1,237 1,920 2,150 2,150 2,150 2,500 2,500 Minimum Official Wage 1,200 2,400 3,300 4,400 4,400 5,800 5,800 Average Monthly Wage* 3,084 4,778 6,406 8,638 9,558 11,509 Maximal Pension Urban 1,710 3,840 4,400 5,920 6500 8,000 8,800 Rural 750 750 750 1,138 1248 1,248 1,250 * Average monthly wage in state sector

Tab. 28 Average annual change of the CPI and wages in the public sector (in %) 1991 1992 1993 1994 1995 1996 1997 1998 1999 CPI change 35.5 226 85 22.5 7.8 12.7 42.07 20.6 16.3 Wage change 27.5 145.3 72.8 54.9 34.1 34.8 10.65 20.4 0.39 Increase of real -5.9 -24.8 -6.6 26.4 24.4 19.6 -22.12 -0.17 15.8 wage* *Calculated as Ratio of the Average Wage Index with Consumer Price Index

Tab. 29 Monthly retirement pensions (in Leks)

1993 1994 1995 1996 1997 1998 1999 Minimal Pension Urban 1075 2200 2710 3750 3750 4000 4400 Rural 528 700 700 1075 1075 1075 1150 Maximal Pension Urban 1710 3840 4400 5920 6500 8000 8800 Rural 750 750 750 1138 1248 1248 1250

Tab. 30 Family economic protection (in thousand Leks) 1993 1994 1995 1996 1997 1998 1999 Total 153.0 145.0 134.9 143.5 145.9 137.7 149.7 Out of which: with 1 member 13.1 12.2 10.7 10.4 10.5 9.6 9.6 2 members 21.7 20.4 18.8 17.7 15.9 14.8 14.8 3 members 30.1 29.1 28.2 29.7 28.6 25.9 25.9 4 members 34.2 33.4 33.2 37.4 41.8 40.1 43.9 5 members 22.6 21.0 19.8 21.7 23.3 22.8 26.5 5 Members 14.3 13.1 11.5 12.6 12.7 12.3 14.2 More than 6 16.9 15.8 12.6 14.0 13.1 12.2 14.8 members

Tab. 31 Family economic protection by prefecture (in thousand Leks) 1994 1995 1996 1997 1998 1999 Total 145.0 134.9 143.5 145.9 137.7 149.7

Berat 8.4 8.6 9.3 10.3 10.1 12.3 Dibër 21.5 17.7 17.8 16.5 12.7 19.1 Durrës 6.0 5.4 4.8 5.2 4.1 4.3 Elbasan 18.8 18.9 19.9 20.7 20.3 19.9 Fier 6.2 3.1 5.8 7.2 6.6 6.6 Gjirokastër 2.8 2.1 2.4 2.6 2.4 2.9 Korçë 11.1 11.2 11.3 12.3 12.6 12.8 Kukës 14.9 11.3 14.8 12.4 12.5 14.1 Lezhë 9.9 9.4 9.0 9.7 9.7 10.3 Shkodër 17.2 20.3 23.6 21.5 24.3 25.7 Tiranë 22.1 21.2 19.8 19.4 16.3 16.5 Vlorë 6.2 5.7 5.2 8.1 6.1 5.2

Tab. 32 Evolution of consumption price index (CPI) and main groups Annual Growth (in %) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Total 2.5 104.1 236.6 30.9 15.8 6.0 17.4 42.07 8.69 -1.03

Food, Beverages and Tobacco 3.6 111.1 256.4 27.0 7.3 6.4 20.0 45.76 8.42 -1.44 Clothing and Footwear 2.5 111.5 169.8 11.8 4.9 8.7 15.6 41.8 10.51 1.66 Rent, Water Fuel and Power -4.7 15.1 274.7 116.3 122.1 3.1 21.4 29.09 16.21 2.87 Household Goods and 0.0 117.4 288.6 0.6 -1.3 0.6 5.3 46.6 2.14 -8.36 Maintenance Health Care 0.0 0.0 183.3 20.6 48.2 24.4 9.5 19.03 11.29 12.8 Transport and Communication 4.4 22.9 225.1 141.1 44.7 5.3 3.7 33.54 5.66 2.28 Recreation, Education and 0.0 102.9 156.3 54.6 -2.1 13.8 7.0 27.16 2.86 -7.87 Culture Personal Care 0.0 394.9 147.3 19.1 7.5 5.9 6.0 48.44 6.06 4.12

Tab. 33 Educational institutions School Ye ar 1994 -1995 1995 -1996 1996 –1997 1997-1998 1998-1999 Kindergartens 2668 2670 2656 2408 2330 Elementary Schools 1782 1797 1799 1803 1815 Middle Schools 472 430 408 400 394 High Schools and Universities 10 10 11 11 11

Tab. 34 Student enrolled (in figures) School Year 1994 -1995 1995 -1996 1996 -1997 1997-1998 1998-1999 Children in Kindergartens 80384 84536 84232 80418 81734 Total students enrolled 672898 678082 687130 693947 694074 Elementary School 550737 558101 560731 559324 553411 Middle School 93830 89895 93058 98721 102161 General Middle School 73216 71391 76424 83161 87028 Profesional Middle Schools 20614 18504 16634 15560 15133 High Education and Universities 28331 30086 33341 35902 38502 Full time 17792 17325 17094 18550 20696 Correspondence 10539 12851 16247 17352 17806

Tab. 35 Education indicators School Year 1994 –1995 1995 -1996 1996 -1997 1997-1998 1998-1999 Number of pupils per classroom Elementary School 23 27 28 29 29 Middle School 29 29 32 33 33 Number of pupils per teacher Elementary School 18 18 18 19 19 Middle School 15 14 15 17 17

Tab. 36 Educators, teachers and professors (in figures) School Year 1994 -1995 1995 –1996 1996 -1997 1997 -1998 1998 -1999 Kindergartens 4428 4416 4463 4116 4092 Elementary School 30893 31369 30926 30111 29428 Middle School 6365 6321 6118 5989 5897 High Education (effective scientific-teaching core) ... 1594 1562 1585 1780

Tab. 37 In-patient health care indicators 1994 1995 1996 1997 1998 1999 Hospitals 51 51 51 51 51 51 Total beds 9661 10371 10319 10321 9480 9501 Total Hospitalizations 281990 288856 289268 301087 250043 301132

Tab. 38 Out-patient health care indicators 1994 1995 1996 1997 1998 1999

Medical Centers without beds 2733 2507 2437 2439 2327 2364 Of which: - Clinics 58 53 53 53 50 52 - Health Centers 702 622 637 639 631 634 - Ambulances 1973 1832 1747 1747 1646 1678

Tab. 39 Health prevention indicators 1994 1995 1996 1997 1998 Mother Consultancy 2091 2097 2073 2073 1709 Family Planning Centers 80 83 92 92 92 Consultancy in Family Planning Centers 49140 49801 63565 65301 55496 Women Applying the Contraceptive Methods 8306 5367 33129 35871 52915 Children Consultancy Centers 2268 2167 2167 2167 1692 Pharmacies and Pharmaceutic Agencies 364 . . . 743 743 743

Tab. 40 Electric power balance (in milion kwh) 1995 1996 1997 1998 1999 Total Resources 4616.8 6263.5 5895.1 6136.8 6509.1

Domestic Production 4477.9 5778.8 5183.8 5067.9 5396.4 Thermal power plants 172.2 206.3 157.5 82.6 112.7 Hydro power plants 4305.6 5571.4 5025.6 4984.8 5283.5 others( pilot enterprizes) 0.0 1.1 0.7 0.4 0.2 Import 138.9 484.7 711.3 1068.9 1112.7

Total Use 4616.8 6263.5 5895.1 6136.8 6509.1

Export 213.0 1407.5 839.2 690.4 754.6 Network losses 2347.3 2547.6 2913.1 3189.3 3047.5 Use by domestic consumers 2056.5 2308.5 2142.8 2278.9 2707.1 Out of which : Industry 505.5 540.8 364.6 383.1 453.6 Agriculture 39.1 46.2 26.2 29.3 34.5 Population 882.5 1093.5 1104.8 1239.2 1501.1 Others not specified 629.4 628.0 647.2 627.3 717.8

Tab. 41 Construction cost index (in %) Quarter I, 19 93 =100 Title Weights Quarter Quarter Quarter Quarter Quarter IV IV IV IV IV 1995 1996 1997 1998 1999

Total 100 151.39 159.66 176.88 216.5 231.62

I. Direct Expenditures 73.72 154.85 162.28 186.04 217.5 236.86 1.Expenditures for Materials in total 65.75 142.27 148.14 164.72 180.9 184.21 a. Building materials 62.77 143.22 149.25 165.7 182.8 185.83 b. Electric materials 0.98 110.23 110.51 118.69 121.3 127.23 c. Hydrosanitary materials 2 127.95 131.74 156.52 151.1 154.92 2. Basic salaries fees 4.03 390.54 432.19 569.88 864.0 1177.0 3. Transport fees 2.18 111.11 106.03 144.38 155.2 151.46 4. Machinery fees 1.75 139.07 141.71 154.31 178.8 177.24 II. Complementary Expenditures 8.11 152.49 160.29 175.44 231.0 263.94 III. Anticipated Profit 12.27 151.41 153.61 143.37 201.2 172.80 IV. Set up Site 4.7 67.83 114.82 45.61 94.4 78.86 V. Turn Over Tax 1.2 258.68 232.46 482.55 692.2 696.18

Tab. 42 Vehicles Year 1996 Year 1997 Year 1998 Year 1999 Total 116,906 126,007 145,201 158,740 Cars 67,278 76,364 90766 99220 Buses 7,612 8,741 9227 10316 Trucks 27,774 30,228 34378 37880 Road Tractors 2,838 3,192 2731 3018 Motorcycles 7,907 3,694 4109 4061 Trailers 3,497 3,788 3990 4245

Tab. 43 International air transport 1995 1996 1997 1998 1999 Air Companies 12 12 13 13 12 Flights 2,817 3,790 3388 4304 8249 Commodities (in Ton) 585 873 794 926 895 Mail (in Ton) 98 143 149 222 210 Passengers 213,343 283,010 242435 295308 356823

7 Tab. 44 Foreign trade in million Leks Year Export Trade Import Changes Exp/Imp in % Aid

1993 12,500 42,982 -30,482 29 15,355 1994 13,386 51,913 -38,527 26 5,105 1995 18,710 60,312 -41,602 31 5,835 1996 22,001 94,947 -72,946 23 3,113 1997 21.044 92.299 -71.255 22 2,722 1998 31,104 119,700 -88,596 26 6,571 1999 37913 123793 -85880 31 35,166

Tab. 45 Gross Domestic Production (GDP) by Main Sector (in million Leks 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

Total (with current price) 16,813 16,404 50,697 125,334 184,393 229,793 280,998 337,114 460,868 542,461

Industry 6,252 5,260 8,548 17,362 23,112 26,943 35,137 41,782 56,974 63,872

Agriculture 6,762 6,967 27,491 68,484 100,755 125,435 148,318 188,698 249,645 287,066

Construction 1,114 1,085 3,867 11,344 17,721 23,621 32,107 37,896 57,589 72,784

Transport 550 537 1,520 3,876 6,213 8,118 9,226 9,239 13,798 17,588

Others 2,135 2,554 9,271 24,268 36,592 45,677 56,210 59,498 82,862 101,151

GDP per capita (thousand Leks) 5.1 5.1 15.9 39.6 57.6 70.7 85.6 102.1 137.3 …

Total (with constant price) 16,813 12,105 11,235 12,309 13,331 15,107 16,482 15,325 16,548 17,871

Industry 6,252 3,882 1,894 1,705 1,671 1,771 2,013 1,899 2,046 2,104

Agriculture 6,762 5,141 6,092 6,726 7,284 8,246 8,494 8,578 8,964 9,457

Construction 1,114 801 857 1,114 1,281 1,553 1,840 1,723 2,068 2,398

Transport 550 396 337 381 449 534 529 420 495 579

Others 2,135 1,885 2,055 2,383 2,646 3,003 3,608 2,705 2,975 3,332 GDP per capita (thousand Leks) 5.1 3.7 3.5 3.9 4.2 4.6 5.0 4.6 4.9 …

8 Tab. 46 Structure of GDP components (in %) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Industry 37.2 32.1 16.9 13.9 12.5 11.7 12.5 12.4 12.4 11.8 Agriculture 40.2 42.5 54.2 54.6 54.6 54.6 52.8 56.0 54.2 52.9 Constructi 6.6 6.6 7.6 9.1 9.6 10.3 11.4 11.2 12.5 13.4 on Transport 3.3 3.3 3.0 3.1 3.4 3.5 3.3 2.7 3 3.2 Other 12.7 15.6 18.3 19.4 19.8 19.9 20.0 17.6 18 18.7

Tab. 47 Annual growth of GDP by sector (in %) 1991 1992 1993 1994 1995 1996 1997 1998 1999

Total (constant price) -28.0 -7.2 9.6 8.3 13.3 9.1 -7.0 8 8 Industry -37.9 -51.2 -10.0 -2.0 6.0 13.6 -5.6 7.7 4 Agriculture -24.0 18.5 10.4 8.3 13.2 3.0 1.0 4.5 5.5 Construction -28.1 7.0 30.0 15.0 21.2 18.5 -6.3 20 15 Transport -28.0 -14.9 13.0 18.0 18.8 -1.0 -20.5 18 15 Others -11.7 9.0 16.0 11.0 13.5 20.1 -25.0 10 12

Tab. 48 Balance of General Government Budget in million Leks 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Budget Revenues 8,291 5,168 13,308 33,476 46,833 54,409 52,907 60,351 101,769 124,782

% of GDP (current price) 49 32 26 27 25 24 19 17.8 22.1 23.0

Budget Expenditures 10,869 8,565 21,317 50,678 60,984 74,154 87,593 100,748 141,200 165,081

% of GDP (current price) 65 52 42 40 33 32 31 30 30.6 30.4

Deficit of General Govt. -2,578 -3,397 -8,009 -17,202 -14,151 -19,745 -34,686 -40,398 -39,431 -40,299 Budget

% of GDP (current price) 15.3 20.7 15.8 13.7 7.7 8.6 12.3 12 8.6 7.4 Source: Ministry of Finance

Tab. 49 Foreing exchange rate (average of the period) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

USD/ Leks 8.9 24.2 75.0 102.1 94.7 92.8 104.5 148.9 150.64 137.53

DEM/Leks 4.7 8.2 47.1 61.7 58.3 64.8 69.5 85.7 86.65 75.14

GRD 100/ Leks ...... 44.6 39.1 40.1 43.4 54.5 51.07 44.99

ITL 1000/ Leks 6.4 11.0 59.1 65.1 58.7 57.0 67.7 87.4 86.78 75.92 Source: Bank of Albania

Tab. 50 Balance of payments (in million USD) 1992 1993 1994 1995 1996 1997 1998 Current Account -50.8 14.7 -42.7 -14.6 -107.2 -271.2 -65 Export Merchandise, f.o.b. 70.0 111.7 141.3 204.8 243.7 158.6 208 Import Merchandise, f.o.b. - -601.6 -601.0 -679.8 -920.5 -693.5 -811.7 540.5 Trade Balance - -489.9 -459.7 -475.0 -676.8 -534.9 603.6 470.5 Services: Credit 20.3 77.5 83.1 97.0 129.2 64.1 86.6 Services: Debit -89.2 -162.0 -171.5 -156.3 -188.9 -114.9 129.3 Income: Credit 2.6 64.9 55.6 70.8 83.6 61.6 86.1 Income: Debit -37.7 -31.0 -41.5 -28.5 -12.1 -11.9 -8.7 Private Transfers 150.0 274.8 374.1 348.9 476.0 235.7 421.3 Official Transfers 373.7 280.4 117.2 128.5 83.5 29 82.6 Direct Investments 20.0 58.0 52.9 70.0 90.0 47.5 45 Portofolio Investments 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Other Capitals 10.7 52.1 11.6 -93.1 -20.9 98.2 9.9 Resident Official Sector 55.0 106.9 119.0 -24.6 68.4 49.4 132 Deposit Bank -59.6 -43.5 -80.2 -56.9 -79.6 82.1 -92.3 Other Sectors 15.3 -11.4 -22.3 -11.6 10.5 -33.3 -29.8 Net Errors and Omisisions 44.8 -9.9 33.0 57.1 96.5 157.1 65.6 Overall Balance 24.7 114.9 54.8 30.6 47.1 43.8 63.3 Reserve and Related Items Reserve Assets -24.7 -114.9 -54.8 -30.6 -47.1 -43.8 -63.3 Use of Credit and Loans by IMF 13.9 16.6 22.2 11.1 0.0 12.2 7.9 Obligations towards Foreign ...... Authorities Exceptional Expenditures ...... Memorandum Items Total Change in Reserve Assets -24.9 -114.9 -54.8 -30.6 -39.5 28.3 -75.9 Differences from Re-evaluation ... -3.8 7.3 5.1 -7.2 -15.5 12.6 Source: Bank of Albania

10 Tab. 51 Comparative data for the countries in the region

Country Populatio Private Enterprises Trade and markets Financial institutions n sector share of Privatizati Privatizati Property Price Trade Comp Banking Capital (in on of big on of structure liberalizatio and etition reform and market and million, GDP (%, June1999 enterprises assets and and n Foreign liberalization financial June small restructuri Exchange of interest non- 1999) ) enterprises ng rates banking institutions Albania 3.2 75 2 4 2 3 4 2 2 2- Bulgaria 8.2 60 3 3+ 2+ 3 4+ 2 3- 2 Bosnia 4.3 35 2 2 2- 3 3- 1 2+ 1 FYROM 2 55 3 4 2 3 4 1 3 2- Rumania 22.4 60 3- 4- 2 3 4 2 3- 2 Croatia 4.5 60 3 4+ 3- 3 4 2 3 2+ Slovenia 2 55 3+ 4+ 3- 3 4+ 2 3+ 3 Source: Transition Report 1999, EBRD. Evaluation system: from1-little progress, to 4+ , the standard of industrialized European countries.